Taxing yourself more for things that your city ought to be doing already might seem ludicrous at first glance, but when it comes to fixing streets and sidewalks, some major commercial and retail property owners in Los Angeles seem open to the idea.

“I absolutely would favor taxing myself more,” said Robert Buente, chief executive of 1010 Development Corp., an affordable housing developer and property owner in downtown L.A.’s South Park neighborhood.

Buente was commenting on a motion introduced this month by Los Angeles City Councilman Joe Buscaino that would allow property owners in residential and commercial districts to form special assessment districts, which would raise tax revenue to pay for fixing streets and sidewalks. It’s all part of a package of motions that Buscaino – with Mayor Eric Garcetti’s support – introduced to generate revenue for street and sidewalk repairs. (For more on another Buscaino proposal to generate revenue for street fixes, see Page 1.)

The proposal to allow the creation of these assessment districts could come back before the council early next year.

Also supportive of the idea is James Brooks, president of Topa Management Co., the largest retail property owner in Westwood Village.

“If something is not done soon, then the streets and sidewalks will degrade to a point where decay sets in, not only in the streets but in the communities around the streets,” Brooks said.

But both Brooks and Buente said they have concerns with how these districts would dovetail with already existing business improvement districts. BIDs can do sidewalk repairs and some – including the South Park and Westwood districts – have already done so on a limited basis.

There are other concerns, too. For example, Jessica Lall, executive director of the South Park Business Improvement District, said if the BIDs or the new assessment districts had to pay living wages and follow all the city work rules for contractors, making the street and sidewalk repairs could be prohibitively expensive.

“I think this is a good start,” Lall said. “It opens the door for folks who do want to pay to make some improvements in their neighborhood. But we’re concerned about too much responsibility being passed off by the city on to local communities.”

Workers’ Comp Blues

A decade after reforms that were supposed to cut the cost of the California’s workers’ compensation system, California once again has the dubious distinction of having the most expensive program for employers.

Late last month, the Oregon Department of Consumer and Business Services released its biennial national survey of workers’ compensation premiums and found that California was once again on top – by a mile. California businesses pay $3.48 for every $100 of payroll, well ahead of No. 2 Connecticut, where companies pay $2.87, and nearly double the national median of $1.85. California was ranked third most expensive in the department’s 2012 report.

To get a sense of the pain local employers are suffering, consider Bob Winningham, owner of Downey Vendors Inc., a 50-employee vending machine service company headquartered just outside Downey in Bell Gardens.

Winningham had benefited from the 2003 and 2004 reforms as his workers’ compensation insurance premiums gradually declined to about $30,000 a year, or just over 4 percent of payroll.

Then, three years ago, he got hit with two claims from longtime workers – claims for back and repetitive motion injuries he regarded as fraudulent and that the reforms were supposed to weed out. As the cases have ground on, and after he was dropped by his insurer and forced to find another, his premiums shot up five-fold, to $150,000, well over 10 percent of payroll.

“It’s too easy to file claims for these soft-tissue injuries, claims that are impossible to prove or disprove,” Winningham said. “Employees end up on lifetime disability, which we as employers are effectively paying for.”

Of course, this isn’t the first time California has topped the Oregon list. Back in 2003, workers’ compensation premiums reached a staggering $4.81 per $100 payroll. After the reforms, California’s standing improved and by 2008 the payroll cost had fallen to $2.72, putting California at No. 13.

But new loopholes have gradually been discovered and claims costs have rocketed back up.

“It’s a system that is once again out of control,” Winningham said.

Fracking Ban Delayed

So what happened to that fracking ban that L.A. city leaders back in February so loudly proclaimed they wanted to see enacted?

After nine months of little public activity, the city Planning Department finally issued a report. But instead of a blueprint for a ban on fracking – the controversial oil drilling practice used to force oil out of rock formations – the report essentially said the city shouldn’t act now on a ban.

The city lacks the technical expertise and needs to hire consultants, the report said. Also, the city should wait until a legal challenge filed by the Western States Petroleum Association against a similar proposed ban in Compton is resolved.

Staff reporter Howard Fine can be reached at hfine@labusinessjournal.com or (323) 549-5225, ext. 227.

For reprint and licensing requests for this article, CLICK HERE.