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L.A. City Council votes to let mall developer keep tax revenue

Council votes 10-0 to let Westfield keep up to $59 million in tax revenue produced by a shopping mall and hotel in Warner Center over 25 years.

June 28, 2013|By David Zahniser

The Los Angeles City Council on Friday backed a plan to let shopping mall giant Westfield keep up to $59 million in tax revenue over 25 years, one in a flurry of decisions made before six council members leave office.

The council voted 10 to 0 to let Westfield keep up to 42% of the net new tax revenue produced by a planned shopping mall and hotel in Warner Center over 25 years. The project is expected to generate $140 million in taxes during that period.

Departing Councilman Dennis Zine spearheaded the effort, saying the additional funds would allow Westfield to speed construction of its mall. But Woodland Hills resident Colleen Marmor urged the council to reject the deal, saying neighborhood councils had little opportunity to weigh in on it.

"We are a city that is financially strapped," Marmor said. "And yet it was at the end of the agenda and heard in a bum's rush fashion at the eleventh hour."

The terms of Westfield's financial package were unveiled one week ago and had no review in any council committee. After a send-off for departing Councilman Bill Rosendahl that featured video testimonials and lasted more than an hour, Council President Herb Wesson gave the public 10 minutes to speak on the Westfield deal.

Woodland Hills resident Siegfried Othmer asked to speak against the Westfield deal for three minutes but was rebuffed by Wesson, who informed him that a total of five minutes had been allocated for every opponent of the plan. "I've spent several hours here. This is important," Othmer said.

"I will give you one minute starting now," Wesson responded. "Do not debate me. You're wasting your time."

The council instructed city lawyers to draft documents that would let Westfield keep tax money that would typically go into the general fund, which pays for police officers, firefighters and other basic services. Council members also signed off on a plan backed by departing Councilman Ed Reyes to sell city-owned land to an auto dealer in the Glassell Park section of his district. And they gave preliminary approval to a proposal from real estate developer Casden West L.A. to build hundreds of homes next to an Expo light-rail station on Sepulveda Boulevard.

Casden scaled back the size of the project earlier this week, dropping plans for a Target and a supermarket. Attorney Ben Reznik, who represents a homeowner group fighting the project, said the changes were made without proper public input.

The Westfield deal drew support from labor unions and San Fernando Valley business groups. The proposal was supposed to come up for a vote Wednesday but was delayed to give Zine time to marshal support for it, including an endorsement from the Los Angeles Daily News, said David Fleming, who serves on the "Los Angeles 2020" Commission convened by Wesson to address the city's financial problems.

Fleming said the mall and hotel project would ultimately give the city a financial boost, helping it avoid cuts in services. "The only way to solve this [budget] problem is to get more revenue for the city," he said.

Still, one taxpayer watchdog promised the Westfield deal would become a campaign issue the next time L.A. voters are asked to raise local taxes.

"If this giveaway passes, Westfield will be the poster child of why we do not need [a] street repair tax," said Jack Humphreville in an email to council members earlier this week. Humphreville helped defeat Proposition A, a sales tax increase, earlier this year.

Wesson said he was not troubled by such warnings. "Jack Humphreville thinks the sky is always falling," he said.

david.zahniser@latimes.com

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