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When Goliath Wins: The Triumph of Redevelopment in Los Angeles

by Leslie Radford Monday, Nov. 14, 2011 at 8:48 PM
leslie@radiojustice.net

On Tuesday at 8:00 a.m., the South Central Farmers, their supporters, and the residents of the Central-Alameda neighborhood will confront the Los Angeles City Council in its chambers one more time to try to save the Farm and save the neighborhood. in the unlikely event they succeed, they might save the City.

Click here to send an email to Los Angeles City Councilmembers and a copy to the South Central Farmers asking the council to vote against the sale of the soccer field land.

Perry, Villaraigosa, and AEG CEO

Jan Perry (r) celebrates with football stadium developer Timothy Leiweke (l) and the current mayor.

LOS ANGELES, November 13—On Tuesday at 8:00 a.m., the South Central Farmers, their supporters, and the residents of the Central-Alameda neighborhood will confront the Los Angeles City Council in its chambers one more time to try to save the Farm and save the neighborhood.

In the last chapter of a David and Goliath story that will likely end with the victory of Goliath, on Tuesday, the Los Angeles City Council will decide whether to sell two and a half acres planned for a neighborhood soccer field to a local developer. It would be a small matter if it wasn't a marker for the end of an era in Los Angeles. When the city council sells the soccer field to Ralph Horowitz, it green lights Horowitz's sale of fourteen undeveloped acres to a manufacturing consortium. And with that gesture, the last significant block of undeveloped land in Los Angeles, the legendary South Central Farm, will be fed to L.A.'s voracious development monster.

City hall has rolled out the promise of “development” for a century to annex and devour everything in all directions, from the fabled orange groves on the west side to the jazz clubs of South Los Angeles. After Tuesday's vote, that frontier will close and the remaining history of Los Angeles will be one of redevelopment—tearing things down to build new things—and selling off public land, undoubtedly public parks and green spaces, to private interests or, more popularly for now, the public-private partnerships that turn over public spaces to private control with long-term leases.

It's not without significance that this bit of land is the last bit of the South Central Farm, probably the nation's largest urban farm, sold off to Horowitz by the city council in 2003. A Farm, especially one that sprung up on an abandoned site without any bureaucratic impetus, is anathema to the development behemoth. The South Central Farm was a 14-acre community-generated space to answer the community's need for fresh food. The South Central Farmers who cleared and cultivated the acreage bypassed city permissions and forced the city retroactively to hand over the project to the nearby Food Bank's supervision. The Farmers bypassed both the supermarket industry and the reluctance of that industry to invest in the low-income neighborhood. They ignored agribusiness's insistence that urban populations be forcefed a diet of mass-produced, genetically modified foodstuffs.

After the Farm was handed over to the developer in a fire sale of public property, Horowitz pledged to gift a small plot on one corner to the neighborhood for a park. On Tuesday, Horowitz's sometime dinner companion, Councilmember Jan Perry, will ask the council to give up the the last piece of the Farm for $3.6M. The vote to support the sale is likely to be unanimous, no matter what the public outcry. The Center for Government Studies has revealed that 99.993% of L.A. City Council votes are without even a single dissension because, the study concludes, “[C]ouncil members face retribution from fellow members if they break ranks and vote against the majority. This unanimity complicates assessments of the influence of campaign contributions. Most council members receive contributions from the same sources, and virtually all of them vote the same way” (Ava Alexander, “Money and Power in the City of Los Angeles,” 2010).

When they sold the Farm to Horowitz, the council pretended that the Farm wasn't providing produce to 350 families and neighbors in the low-income urban farm desert. The council turned a blind eye to the demands of hundreds of occupiers, international support and attention, and dozens of the rich, famous, and influential, to appease a small-time developer. At the head of the city hall squad then and now was the Farm district's own Councilmember, Jan Perry. Two decades earlier, the city had purchased the land from Horowitz by eminent domain for $4.7M. Area residents blocked a planned incinerator project, and the city sold the land to the Harbor Commission. Horowitz sued to get the land back. In a backroom, off-the-record deal in 2003 approved by the City Council, the Harbor handed the land back to him for just $5.3M, paid to the City. Effectively, the city calculated a property appreciation rate of less than one-half of one percent annually during the the biggest growth in land prices in U.S. history. Horowitz turned around and put the land on the market for nearly three times what he paid.

Only those who sat in that room somewhere in the bowels of city hall that day know what happened, why a city treasure was fed to development. Presumably, the city council and the Harbor Department had the option to settle with Horowitz for the sale price but instead rushed to ensure that the developer's bulldozers would destroy the upstart Farm. How the city ended up with the payment for land owned by the semi-autonomous Harbor Department remains a mystery. What's apparent now is that the Los Angeles City Council is still at the mercy of the forces that were at work then, and that they are closing ranks to ensure that whatever happened doesn't impede Perry's mayoral campaign.

According to the city charter, the Harbor Department has “possession, management and control of all property and rights of every kind whatsoever” over land it owns, except, apparently for the tract at 41st and Alameda. The city had sold the land to the Harbor in 1994 for $13.3M. This past August, in what points to unresolved issues around the title, transfer, and sale, Perry asked the Harbor Department to weigh in on accepting the cash payout instead of the land transfer. Perry insisted on Harbor Department approval with the peculiar stipulation that “The Harbor Department has no interest in the pledged property.” Perry's influence does not reach to the largely independent Harbor: Harbor Commissioners refused to sign off on the sale in the face of public outcry and hot-potatoed the issue back to city hall. Perry responded with a city council motion that forces Harbor compliance. The motion to convert the promised land gift to cash includes the following instructions to the Harbor:

  1. PRESENT and ADOPT the accompanying ORDINANCE amending the previous Agreement entered into by the Harbor Department and Libaw-Horowitz Investment Company concerning the Lancer Property (41st and Alameda) in Council District Nine to convert from land to cash and establishing the Lancer Site Recreational Improvements Trust Fund for the cash pledge of $3,573,365 to be used for park purposes in Council District Nine.

  2. APPROVE the Termination and Release of Pledge Agreement and Associated Cash Pledge of $3,573,365 between Libaw-Horowitz Investment Company and the Harbor Department (attached to the Harbor Commission report dated August 4, 2011, in the Council File).

  3. 4. AUTHORIZE and DIRECT the Executive Director of the Board of Harbor Commissioners to execute, and the Board Secretary to attest, to: a. Termination and Release of Pledge Agreement between Libaw-Horowitz Investment Co. and the Harbor Department. b. The associated Cash Pledge Agreement between Libaw-Horowitz Investment Company and the Harbor Department.

The City took the land from Libaw-Horowitz in 1986 for $4.7M, sold it to the Harbor in 1993 for $13.3M, and apparently received payment for the transfer from the Harbor to Horowitz in the amount of $5.3M. On Tuesday, the council will discuss accepting an additional $3.6M for the soccer field land. If the deal goes through, from all appearances, the Harbor Department will have transferred $16.9M from the sale of its assets to City coffers.

The Lemming Factor

In 2006, Perry led the city council in accepting Horowitz's pledge to donate the soccer field land to the neighborhood, a small compensation for the loss of a city treasure. This week, Perry will ask the same city council, with many of the same faces, to reverse themselves, because, Perry told the L.A. Times in August, diesel fumes make the land unsuitable for children. With Perry, eleven of fourteen councilmembers, including Ed Reyes, Dennis Zine, Tom LaBonge, Tony Cardenas, Bernard Parks, Herb Wesson, Bill Rosendahl, Greig Smith, Eric Garcetti, and José Huizar, will revisit and revote, in effect deciding whether conditions have substantively changed since they accepted the promised soccer field land.

In fact, nothing has changed, or at least nothing that the councilmembers will say out loud. Ironically, Perry's claim of air pollution comes from a 2008 Environmental Impact Report to develop a similar project, a manufacturing and shipping facility for a garment manufacturer. The South Central Farmers, displaced from the land but still active in the community, demanded the EIR for that proposal. The results of that study showed that the project would increase area air and noise pollution to unacceptable levels. Waving that report, Perry and the council presumably will deny the neighborhood their soccer field to make room for a facility that will generate the pollution that makes the soccer field untenable. No one has mentioned that the sale will further depreciate a low-income neighborhood that's already reeling.

Perry has also held out the L.A.-based manufacturing consortium's promise of 600 permanent jobs. How many of these are transfers from existing Los Angeles operations is unknown, but even if the promise is 600 new jobs, the impact will be to reduce the city's unemployment rate by a mere two-tenths of one percent, according to October figures from the CA Employment Development Department. In spite of the pollution, the property depreciation, and the infinitesimal effect on unemployment, the people living in Central-Alameda are most likely to wake up on Wednesday morning without their soccer fields.

Apparently, the councilmembers are no less beholden to developer Horowitz today than they were a half-decade ago when they defied massive public support for the Farm and practically gave the land to him. All that has changed since the city accepted Horowitz's pledge to gift the land is that Horowitz has finally found a buyer, and that buyer is demanding that the package include the soccer field acreage. In exchange, Horowitz has put $3.6M on the table to get out of his agreement. Perry wants to put the money in trust to refurbish an area housing development and two other parks in her district, effectively flipping the money back to the developers, maybe to Horowitz himself. Perry and the manufacturing consortium packed a Budget and Finance Committee meeting last month with housing residents and a cohort of employees in matching blue T-shirts, but their demands for desks and chairs for the housing project were unable to drown out the voices of neighbors and farmers who presented hours of testimony recognizing that a park would serve the neighborhood long after the $3.5M was spent. Councilmember Rosendahl raised significant issues, including why the manufacturers needed to take the soccer field land for their facility, but just before the vote, Councilmember Parks held a long, whispered conversation in Rosendahl's ear, and the final committee vote was, unsurprisingly, unanimously in favor of Perry.

On Tuesday, Central-Alameda neighbors and the South Central Farmers, the Davids of this story, will face the city council in what has become a familiar showdown. On dozens, maybe more than a hundred, occasions over the past decade, since the Farm was first put up for sale, the residents and the Farmers have gone to city council to ask to be heard. The council has never investigated their concerns or referred them to committee for consideration. Perry has never lost: in ten years of votes related to the Farm land, thnot a sigle dissenter has broken the lockstep of city council.

Perry for Mayor

Perry has made her career out of feeding bits and pieces of land in her district to developers, regardless of whether that is megadeveloper Eli Broad for downtown gentrification or a bit player like Horowitz for a factory instead of a farm. Her latest proposal is to replace the defunded Community Redevelopment Agency, a state agency that provided money for developers, with “a very independent, highly focused, small group of people to continue to attract, retain and develop business, retail and housing opportunities in and around the Downtown area,” reports the Downtown News. Perry is mounting an elite power base to determine downtown's future.

Perry is running for Mayor. The largest part of her 2009 council campaign funding, nearly one-fourth of the money she raised, came from the real estate industry. Perry is a major player in the speculative deal with developer AEG to build a football stadium in downtown with the dream that if L.A. builds it, a team will come.

Undoubtedly it is those connections to developers and influential people, the Goliaths behind city hall, that Perry hopes to transform into a successful bid for the Mayor's office. Tuesday's vote will hand her the implicit endorsement of city council for her election (no doubt to the consternation of fellow mayoral candidate and city council President Eric Garcetti). In the unprecedented event that the council did vote against Perry, their rebuke of the land transfer would signal that Perry's alliance with developers was not in the city's best interest, effectively pulling the lynchpin out of her support with the voters she is relying on to support her plans for further development. And assuredly, the campaign chests of those who oppose her would suffer the wrath of the development beast. To developers, city council rejecting Perry's proposal would signal that Perry could not manage the city council or shut down grassroots opposition in the interest of those developers. On the other hand, a council vote for the transfer is a clear message that, although development in Los Angeles may be over, Perry and the redevelopment monster are will be fed. Los Angeles's Age of Redevelopment, when tearing things down to rebuild them becomes the core of Los Angeles's urban economic “growth,” formally begins on Tuesday with the destruction of the last vestige of South Central Farm.

###

Click here to send an email to Los Angeles City Councilmembers and a copy to the South Central Farmers asking the council to vote against the sale of the soccer field land. Just click and add your name to the email, or replace the text with your own.

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