December 16, 2003 - From the December, 2003 issue

L.A. Councilmember Wendy Greuel Making The Case For A More Business Friendly City

One theme to emerge from the recall election was the escalating cost of doing business in California. Los Angeles in particular, has emerged as a costly and unpredictable environment for small businesses to set up shop. TPR is pleased to present this interview with LA Councilmember Wendy Greuel, in which she outlines recent efforts, from tax reform to a re-organization of the Entertainment Industry Development Corporation, to make Los Angeles more business-friendly.


Wendy Greuel

The L.A. City Council's Government Efficiency Committee, which you chair, has not typically been the committee from which leadership on the Council comes. But, it appears that you might change that commonly held perception. What's the committee's agenda going to be?

I believe government efficiency is more than just reforming bureaucracy. We want to look at ways in which we can save money and change the way we do business. Many of our constituents talk to us about what they find wrong with the city of Los Angeles. They see inefficiencies-unnecessary street repaving, improper tree trimming, or generally slow or unresponsive services. I have been pleasantly surprised that the leaders in the city are as excited as I am about this committee and a rejuvenation of government efficiency. In a time of tight budgets, it seems to be a more sexy issue than it would have been in the past. I asked for this committee assignment because I felt it had huge potential for making the city run differently-and better.

One example of how we're saving money is by eliminating the various 1-800 phone numbers for the city's service departments. We have a 311 system, and we still have $500,000 worth of toll-free numbers that are being utilized. We've asked them to come back with a report that identifies ways to steer people to the 311 system. Another example is the consolidation of security forces in the city of Los Angeles. That will save money and make us more efficient in being responsive to our security concerns

Let's link government efficiency to your campaign pledge of making the city more business friendly. What tools exist at the local level to realize such a goal? What is the best approach?

There are several ways in which you can make Los Angeles a more business friendly city. Obviously, the foremost vehicle is business tax reform-making this a less cumbersome system and trying to encourage businesses to stay in the city of Los Angeles. I come from a small business family that had so many problems with the different filing categories and the different levels at which they had to pay taxes.

Our focus in this effort is on small and medium sized businesses. The SBA had indicated that small business represents about 99.7% of all employers, generating 60-80% of the net new jobs annually. We need to make sure that we keep these businesses here in the city of Los Angeles. When I chaired the Ad-Hoc Committee on Business Tax Reform, I spearheaded the single category tax filing, the review of the gross receipts tax, the review of pass through taxes, and the simplification of categories. We need to continue to look at ways in which we can reduce business taxes which, in the end, will increase the amount of revenue the city of Los Angeles can expect to gain-the more business friendly we are, the more businesses will locate in the city

Today, there is a report that Senator Burton has gutted the workers' comp reforms from the last session as a shot across Governor Schwarzenegger's bow. You know that the Chamber and the public sector have been interested in workers' comp reform for a long time. What's going to make the difference here? Where is the leadership going to come from?

The leadership has to come from the state level. If I have heard it once, I've heard it a thousand times: workers' comp is driving businesses out of the state of California. Obviously, that has a great impact on the city of Los Angeles and we need to curb those costs. The legislation passed by the Legislature this last session was a good start. However, we all believe that we can do more. I, along with Councilmemeber Dennis Zine, City Attorney Rocky Delgadillo, and Mayor Hahn, have stated that workers comp reform is a top priority for us. We want to make sure that the state does not relinquish its responsibility for curbing workers comp costs.

The EIDC recently announced significant reforms to its structure and governance. Can you elaborate on those reforms?

Today is a new day in the EIDC. As a member of the Executive Committee, I presented a plan to the full Board of Directors for restructuring the EIDC. The reforms give the corporation a new foundation allowing it to fulfill its core mission of coordinating film permits, protecting the quality of life in our neighborhoods and addressing the needs of the film and media production industry. The new board has representation not only from the entertainment industry, but also from the community and from business leaders.

Going forward, the EIDC needs to refocus on its core responsibility of permitting in the city and county of Los Angeles. Second, the EIDC needs to have fiscal responsibility in management, which did not exist before. We have put checks and balances in the by-laws to create that accountability. We've taken every elected official off of the board, amended the by-laws to include language restricting political contributions and we have instituted an open and transparent process to involve the community in the EIDC's decision making.

Sometimes, out of crisis comes opportunity. I was pleased to see the new board of the EIDC today, and they are similarly focused on balancing the needs of keeping production in Los Angeles and addressing the needs of the particular communities impacted by filming

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Is campaign finance reform related to making L.A. a business friendly city?

Yes. I think campaign finance reform is critical for the city of Los Angeles. Businesses, as well as the public, want to know that this is a clean city. Sometimes, I have been a lone soldier on this issue, trying to advance the strictest reforms on campaign finance for Los Angeles. We need to make sure that this is a transparent system so that people believe that councilmembers are not bought and sold on the city council.

Last week, I was informed that individuals had been indicted relative to illegal campaign contributions of which some of my colleagues and I were recipients. Obviously, we had no idea. When someone sends you a check, you assume that another party is not reimbursing the donor for that contribution. We need to find a way to stop such practices

But actually, there were some critics of that indictment suggesting it was rather selective, given allegations of more egregious fundraising associated with LAX contractors, Mayor Hahn's office and the president of the Board of Airport Commissioners. How pervasive and serious is the political fundraising problem in Los Angeles?

Unfortunately, I don't think we know. But, it's critical for people to have confidence in their elected officials, and we need to minimize the negative impact of campaign contributions. Campaign finance reform is of critical importance. The tougher you make it for there to be any kind of improprieties, the better. There will always be people who try to find a way around it, but we need to continue to have reform. The actions of the last couple of weeks demonstrate that our work is not done.

It's been a year since the secession vote. Has the dust settled; have the aggravating grievances been addressed?

I held a forum a few weeks ago on the anniversary of the secession vote, and a lot of my friends and colleagues asked, "Why do you want to bring up the ‘S' word? That was a campaign we defeated." But, it was more than just a campaign. Whether you agreed or disagreed with the proposed outcome of a secession vote, the real issues that fueled secession still exist. These issues of accessibility, the Valley's fair share, business tax reform, and neighborhood participation aren't going away. As a City Council and particularly as Valley councilmembers, we must not let up in our promises to give the Valley its fair share.

We have taken some positive steps in that last year, but, in my view, we need to do more. At the forum, a majority of the people who were for secession were invited to attend. And, I was pleasantly surprised that many of them came with constructive criticism, or constructive ideas, about how we can make the city better. Their participation is critical and we've seen much more attention directed to the San Fernando Valley since that secession vote

Wendy, one last question about planning and smartly integrating planned public facilities investments in our inner city and inner suburban neighborhoods. LAUSD's school board recently voted to put a $3.87 billion facilities bond on the March ballot. Leveraging this local facilties bond with state facilities bond funds promises more than $6-7 billion in revenue for new schools, many of which will be in the Valley and in the heart of Los Angeles' most densely populated neighborhoods. In your opinion, is the city and the school district adequately siting and planning for these new schools to assure that we not only build great schools, but improve our neighborhoods by designing these facilities as joint-use centers of our communities?

I'm optimistic that we will not waste this opportunity. There were some instances where the city and the school district and the CRA were at odds because there was not appropriate planning. At Valley Plaza, which is in my district, we were concerned that the LA Unified School District was going to place a school in the middle of an economic development project. The outcome of that debate was a memorandum of understanding between the city, the LAUSD and the CRA outlining a joint planning process. At these types of locations, we want to balance the need for more schools with the other desperate needs we have in Los Angeles, including housing and economic development. So, it is my hope, based on my conversation with Superintendent Roy Romer, that the school district has that same goal in mind. It would be shameful for us to have that kind of investment leverage and fail to plan for the multitude of needs in any given neighborhood. I certainly will keep our school district's feet to the fire to have them take part in that process.

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