Pacoima leaders praised the announcement Tuesday that their community has been chosen as one of the first state enterprise zones, calling the designation "the greatest marketing tool" to revive the area's decaying business district.
A 6.7-square-mile district along San Fernando Road was one of 13 locations, including portions of central Los Angeles and Watts, selected by the state Department of Commerce from a pool of 65 communities that applied for the enterprise zone designation.
'Neutralize the Negativism'
"I think this is one of the biggest things to happen to Pacoima since I've been here--and that's 27 years," said Mel Wilson, chairman of Pacoima's enterprise zone advisory committee and vice president of the United Chambers of Commerce of the San Fernando Valley.
"It's the greatest marketing tool we can use to bring attention to the area," Wilson said. "Now we will have something to neutralize the negativism about Pacoima. The Valley is really booming right now and this is going to give us a chance to show that we are part of the San Fernando Valley, too."
The Enterprise Zone Act, signed in 1984, is designed to revive blighted communities, stimulating employment by attracting new businesses and encouraging industry to expand. The program offers businesses in the zone exemptions from many state and city regulations and gives them financial incentives, such as tax breaks.
Pacoima community leaders had latched onto the concept as a way to remedy the area's image problems and 18% unemployment rate. The application to the state described Pacoima as a "distressed community" with income less than the city average, high unemployment and low educational levels among its residents, more than 70% of whom are Latino or black.
Community leaders and area legislators said it will take at least two years before a change will be seen in Pacoima's economy, but they predicted Tuesday that the enterprise zone will eventually create hundreds of jobs.
"In two to three years there will be a major drop in unemployment in Pacoima," said state Sen. Alan Robbins (D-Van Nuys), whose district includes Pacoima. Robbins said he is looking into state proposals to locate a California Department of Transportation maintenance yard in the enterprise zone this year, which would bring about 150 jobs to the area.
"I think the real importance is the recognition of the potential in Pacoima," said Assemblyman Richard Katz, (D-Sepulveda), whose district includes Pacoima. "Psychologically, the designation is incredibly important. It gives us a tremendous tool to go out on a recruiting blitz to attract business."
Richard Whitman, the state Commerce Department's enterprise zone coordinator, said Tuesday that Pacoima was selected largely because of strong community support for the program.
The 12-member community advisory committee, the San Fernando Valley Board of Realtors, the Valley Industry and Commerce Assn. and chambers of commerce throughout the Valley wrote letters to state officials in support of the enterprise zone.
"The main thing we found unique about Pacoima was that the chamber and the business community seemed to be fully behind it," Whitman said.
Under the program, the state will offer a tax credit of up to 50% of an employee's wages to businesses that hire workers who were receiving government assistance. Other incentives include a tax credit for sales tax paid on machinery purchases and tax deductions for banks that lend to enterprise zone businesses.
The City of Los Angeles' Community Development Department will set up an enterprise zone office in Pacoima with two staff members, who will devise a marketing strategy to attract business, aided by the Bureau of Business Services and Research of California State University, Northridge.
No City Incentives
In September, when the City Council voted to submit Pacoima's application to the state, it refused to add city incentives, such as exemption from business fees and utility taxes, which community leaders believed would give the area an extra boost.
Instead, the city said it would target employment programs and financial assistance to the enterprise zone areas but did not allocate specific amounts of money.