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A Savvy Housing Group Expands

The East Los Angeles Community Union, known for cultivating Latino leaders, builds in the Inland Empire.

December 27, 2004|Hugo Martin | Times Staff Writer

An East Los Angeles nonprofit organization known as a prolific low-income housing developer with political ties to high-ranking Latino lawmakers has launched an aggressive expansion into the fast-growing Inland Empire.

The East Los Angeles Community Union, an economic development corporation that includes profit-making subsidiaries, already has opened three senior housing projects in San Bernardino and Riverside counties and is planning to build four more in the near future.

The organization, known as TELACU, is replicating a strategy that made it an influential political player in Los Angeles County: Its officials are building close ties to Latino politicians in the two inland counties in part by distributing generous campaign contributions.

"We are engaging in the political process," said President David Lizarraga. "That's the American way."

The organization is more than a charitable builder. The nonprofit oversees a for-profit family of companies, known as TELACU Industries. The companies include a community bank, a restaurant and a roofing supply company. In all, the group has gross revenue of nearly $100 million a year and $350 million in assets.

Its officials donated more than $200,000 to political campaigns in 2001 and 2002, primarily to Los Angeles County lawmakers such as then-Assemblyman Marco Antonio Firebaugh (D-Los Angeles) and statewide officials such as Democratic Lt. Gov. Cruz Bustamante.

Two of the most powerful politicians in the region, Los Angeles County Supervisor Gloria Molina and former state Sen. Richard Polanco, were former employees of the organization. Esteban Torres, one of its founders, went on to take a job in President Carter's administration and later won a congressional seat.

Over the last two years, Lizarraga and other leaders of the group also have given sizable political donations to several Inland Empire candidates.

During the last election, officials in the organization gave $9,600 to Joe Baca Jr. (D-Rialto), who won a state Assembly seat in November, and $7,000 to Josie Gonzales, who was elected to the San Bernardino County Board of Supervisors. The group also donated $800 to San Bernardino Mayor Judith Valles, who faces reelection in November.

Valles said she has been impressed by the group's work in the region and has no objections to its efforts to build ties with local Latino officials.

"Ultimately, it's OK if it benefits the community," she said.

Gonzales, a former Fontana City Council member, called the group's efforts to bond with Latino lawmakers a winning strategy. "They want to succeed, and that is what businesses do to succeed," she said.

The projects built in the Inland Empire by Lizarraga's group have been financed largely through grants from the U.S. Department of Housing and Urban Development. But local cities also have contributed.

The group's first development in the Inland Empire was a $3.5-million, 57-unit senior housing project that opened in Moreno Valley in 1992. The city contributed more than $950,000 in local and federal funds to pay for improvements.

In the last two years, the group has completed two other senior housing projects in San Bernardino, each with 75 units. The project on H Street cost $8.6 million; the project on 6th Street cost $6.7 million. A third project is under construction in the southern end of the city. The city of San Bernardino contributed about $1 million for off-site improvements, such as landscaping and sidewalk work, to all three projects, according to city officials.

In Riverside, the group is building a $9-million, 70-unit senior housing project on 11th Street. Riverside city officials combined several parcels to form a 2.2-acre property, which the group bought for the building, according to city officials. The city also gave the group a $650,000 grant to cover landscaping improvements and building upgrades.

The organization also plans to build an $8.4-million housing project in Rialto next year.

The group is based in East Los Angeles, but Lizarraga said his organization was prepared to build housing wherever needed.

"Our world doesn't revolve around 4 square miles called East Los Angeles," he said.

Local housing officials have praised the organization, saying it has won local funding partly because of its reputation for securing highly competitive federal grants.

"They know the ins and outs of getting the financing," said Shirley Wolf, housing and community development manager for Riverside.

San Bernardino Councilwoman Wendy McCammack said she had been impressed by TELACU's ability to operate low-income housing projects in blighted communities.

"TELACU has had a reputation of building a good product and maintaining its senior housing status for a long time," she said.

So far, there has been little grousing from local nonprofit developers about the group's move into the Inland Empire. Some developers and housing officials say they welcome the organization to the area because the need for low-income senior housing in the region is great.

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