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Gambling $52 million on the Grandiose Avenue Project Without Asking Any Serious Questions

It’s a shame smart guys like Eric Garcetti don’t put their brains to better use than to sell fantasies to the public on how the investment of just $52 of their money in a parking garage for the Broad Museum will generate 1,340 jobs and $234 million in direct and indirect revenue and make LA arts and cultural capital of the world.

What a deal!
When dumb guys like Tom LaBonge and Ed Reyes talk that way, it’s a lot more understandable. They don’t really know what they are talking about, so they read whatever script they are handed and then.vote the way they are told.
Tony Cardenas, Paul Koretz and Richard Alarcon can feign stupidity and ignorance with those guys but you know they know better, they’re just going along for the ride. It pays the bills for them and all their friends.
“W have to call bad redevelopment bad redevelopment when we see it and we also have to embrace good redevelopment when we see it,” Garcetti declared piously during the short discussion Wednesday before the Council unanimously approved the Community Redevelopment Agency’s gift of $52 million to support billionaire Eli Broad’s vision for Grand Avenue and Bunker Hill.
Like the $30 million gift of taxpayer money to bring Cirque du Soleil to the Kodak Theater — part of a heavily-subsidized project that is worth a third of the $600 million it cost — the Broad Museum, 37,000-square-foot plaza in front of it and the parking structure are what Garcetti regards as “good development,” proper uses of money skimmed from the general fund and schools and other core services for the purposed of replacing “blight” with more beneficial uses.
 
Reasonable people, like taxpayers who see their libraries and fire stations closed and parks program gutted and streets crumbling, might wonder how those glittering towers of steel and glass on Bunker Hill represent “blight.”
But that’s because they have taken a course in how Bunker Hill was the trigger for downtown redevelopment, the centerpiece of the strategy that poured billions in public money through CRA into the pockets of rich developers who had the prescience to sell high to Indonesians and other foreign investors and buy back at the bottom of the market and then pickpocket even more subsidies from the CRA to inflate the value of their property yet again.
When you’ve got their clout at City Hall, it’s not hard to outsmart any outsider. Just ask AEG’s Tim Leiweke how much it cost him to buy a seat at the table of power so he can get anything he wants whenever he wants it.
Bunker Hill is an urban disaster, a zero on the walk-ability scale, the antithesis of Fifth Avenue in New York or Michigan Avenue in Chicago where vast throngs stroll and window shop and hang out to see and be seen. It’s a sterile desert when compared to the old run-down areas of downtown where throngs of working class people walk from tiny schlock shop to tiny schlock shop.
It didn’t have to be this way. When the started this real estate scam, one of the greatest in a city built out of real estate, there were alternative architectural visions that would have brought shops along Grand Avenue and people and business and jobs and spurred development of a downtown that was worth building a rail and subway system that went nowhere but downtown — not the airport, not the Hollywood Bowl, not Dodger Stadium.
Let bygones be bygones. 
Eli Broad has his Grandiose Avenue vision that he has thrown all his enormous clout behind that somehow will make it all work and the Downtown rail connector will make the whole system work and downtown will truly flourish and be something to be proud of, something that works for people, unlike all the luxury hotels and entertainments that the CRA paid to help build.
Maybe he’s right but it’s an examined proposition and even the CRA admitted that tax increment revenues from its projects downtown and elsewhere are falling and in sufficient to cover its debt for the parking garage or much else.
The best they could say in response to Cardenas’ softball question was that they gave Broad $8 million to design the parking structure and are on the hook for $24 million in debt that might never be paid back unless the billionaire puts on his philanthropic hat and pays it off.
While LaBonge prattled mindlessly as usual and suggested “Tom Bradley, John Ferraro and Gil Lindsay would be smiling” from heaven at this deal, Alarcon drew the incomprehensible distinction between the city selling nine parking lots for a song at a fire sale and the CRA building, owning and operating a brand new parking lot.
The CRA assured him that revenue from the Broad Museum would cover “operational costs” — not make money, just meet costs. Alarcon was satistied.
For his part, Koretz wanted to know what would happen if the CRA is abolished — as Gov. Brown wants to do to restore the state’s financial health and stability — and was told the city general fund would only get $10 million or so of the $52 million –enough to reopen all libraries, something that ballot Measure L for all its support from Broad doesn’t guarantee.
What would happen to the rest of the money, like keeping teachers from being laid off, was never asked but Koretz had done his job and elicited a half-truth or in this case a one-fifth truth.
Jan Perry, the queen of downtown redevelopment subsidies, talked about how this was a “rare opportunity” to “elevate to a higher level” downtown development even though the prize development two luxury condo towers to be built by Related Cos. have no funding and the penalties in the firm’s contract have never been imposed.
It was Garcetti who carried the question so many are asking: “How can we provide tax money for billionaires instead of for our core services.”
The answer he offered was as simple-minded as some of his colleagues.

“The public good,” he answered, as if gambling $52 million on a parking structure for a questionable luxury condo project that is in limbo is the proper use of the public’s money is a good thing.

It’s Eli Broad’s vision that matters but he hasn’t put any guarantees in writing as CRA Commissioner Madeline Janis pointed out last Thursday and not a single Council member dared to answer just what his commitment is if this deal turns sour and the public is stuck with the bills. 
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14 Responses to Gambling $52 million on the Grandiose Avenue Project Without Asking Any Serious Questions

  1. Anonymous says:

    It is just amazing that those guys still don’t get what the rest of us know – that the days for taking risks are over. Eli Broad didn’t make his money because he was altruistic. And, he’s gonna bail if this project is a bust. His lawyers have already made sure of that. Ever wonder why guys of his caliber don’t run for office? Let me put it another way, would you want to work with the likes of our City Council on one of your pet projects?

  2. Norma Skock says:

    They’re spending $52 million to put a parking lot on a piece of property that is currently operating as a parking lot?

  3. Norma Skock says:

    They’re spending $52 million to put a parking lot on a piece of property that is currently operating as a parking lot?

  4. Anonymous says:

    China to create World’s largest Mega City…
    http://www.telegraph.co.uk/news/worldnews/asia/china/8278315/China-to-create-largest-mega-city-in-the-world-with-42-million-people.html
    Maybe we should bulldoze all of LA, and start all over….Oooops…Sshh!, Don’t give them any Big Bad Ideas…

  5. Bob says:

    We just went through behind the scenes negotiation to sell City-owned parking lots (P3, etc).
    Now the CRA is saying that “the City will own the parking lot”
    Now which way is it going to be – Are you going to sell Pershing Square and build a new lot?
    Common people – If you are a decent video editor, let’s take cuts from Channel 35 of all the double-talk.

  6. anonymous says:

    Will they, then, sell the parking lot and museum to Eli Broad for one million dollars (or less)?

  7. anonymous says:

    3:01 AM–I’m confused. They said the city will own the parking lot. Does that mean Eli owns the museum? If so, scratch the museum sell, the city will sell the parking lot to him for half the amount they paid to build (rebuild) it.

  8. Anonymous says:

    Thank God our City Council halted the original deal to give the land for the Broad Museum for just $1. Yes… thank God our City Council made Eli Broad pay full-market value for that land. Oh, thank God Broad was required to pay about $20 million for that land.
    Wait a minute. How much more did City Council just pay for the plaza in front of the Broad Museum? $22 million you say?
    Well, thank goodness we made Eli Broad pay for that land!

  9. Inquiring brain cell says:

    I’m straining my one little bitty brain cell over who owns what. Admittedly, I did not watch the Council video and am hoping for a quickie answer here.
    Does Broad own the museum, the plaza and the land both sit on? Will the museum be free to enter? Will the plaza rent vendor space? Is there a public record blue print of it?
    I assume parking won’t be free since the City owns the lot. They do own it, right? Are there provisions with regard to the lot that it can or cannot be sold?

  10. Bob says:

    The City Council shuts down members of the Public in a heart beat if they are “off topic” on Agenda Items.
    Koretz, Cardenas, and the rest all used much of their time to Argue for Saving Redevelopment!
    Off topic, call them on it!
    The Mayor and City Council enforces the law AGAINST the working class taxpayers, but IGNORE the law for themselves and their VERY RICH FRIENDS.

  11. James McCuen says:

    It is critical to leverage your connections (tell 10 people and they tell 10 of their friends, etc), and GET OUT THE VOTE in EACH EVEN-NUMBERED COUNCIL DISTRICT
    Clean House!
    Clean Sweep LA.
    Rock the Boat, Rock the Vote.
    And Hold the New Candidates ACCOUNTABLE

  12. Anonymous says:

    Get in the face of the Mayor tonight at his fake Public Safety Town Hall. NO doubt Eric Garcetti may be there. Tell him we want CRA abolished. Everyone available to go attend tongiht 6:45pm Goodwill Industries, 342 San Fernando Road., They are trying to keep this meeting a secret and told a small group. Let your voices be heard and confront the Mayor and all city council members why they are wasting our hard earned tax dollars for a Billionaire like Broad.

  13. Anonymous says:

    “–smart guys like Eric Garcetti don’t put their brains to better use than to sell fantasies to the public–” Ron, crooks are also very smart till they eventually get caught. It is not about smarts but about morality and ethics that sadly Garcetti lacks.

  14. Diana says:

    This crap is disgusting. The use of CRA monies is just another form of corruption.

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