Historic Site Suffers Monumental Ills

Out in the sun, carefree tourists swirl happily through the bright Mexican shops and restaurants of Olvera Street, the narrow brick lane that’s celebrated as the birthplace of Los Angeles.

But inside the colorful historic buildings, things are in soap-operatic chaos.

Management of the tiny city Department of El Pueblo, which runs Olvera Street, has been so poor that City Controller Laura Chick described it in a recent audit as “on the brink of financial disaster.” The audit found that most tenants had no leases, the department was behind on paying its bills, and cash was left unsecured in the agency’s office.

After the audit, employees were discovered shredding documents in the office. One employee was terminated and another placed on leave, and a new general manager has taken over the ailing $3.1-million operation.

The troubles on Olvera Street are so deep-rooted that merchants say their beloved alleyway is at risk, not only of financial ruin, but physical decay. Olvera Street is falling apart. Its famous monuments and stores are threatened by crumbling roofs, cracking plaster and foul plumbing problems.

“It’s like a runaway train that nobody is doing anything about,” said Mike Mariscal, whose family, like most who work on Olvera Street, has been there since the 1930s.

The 76 merchants whose families have cooked enchiladas and sold guayabera shirts have been divided into bitter camps for years. More recently, the nine citizen commissioners appointed by the mayor to oversee the department have also been split.

Only recently have city officials waded in to regain control and, even then, only after Chick briefly seized control of the agency. Now, the mayor has said he is “very committed” to preserving El Pueblo.

Among the problems cited by the audit and officials:

* Of the street’s 76 tenants, at least 60 did not have signed lease agreements. Others weren’t paying their bills at all: One tenant owed $130,000 to the city.

* The department went without an accountant for months, and a clerk-typist had handled the ledgers.

* The five Olvera Street parking lots, which bring in more than half of the department’s revenue, were poorly monitored. In a city that pioneered the art of sophisticated -- and lucrative -- parking operations, many of the lots at El Pueblo didn’t even have a cash register, not to mention an automatic ticket dispenser. And no one reviewed the books to make sure the money that did come in was being properly recorded and not disappearing into someone’s pocket.

* Several of the department’s more than 50 employees were being paid salaries higher than those allowed by city labor contracts, or receiving unauthorized bonuses. In violation of generally accepted accounting practices, the employee entering payroll data into the computer was also overseeing and authorizing the transactions.

* More than 100 bills totaling more than $300,000 were past due.

* Employees were spending money without authorization and submitting receipts for things they could not prove the department had actually bought or needed. In at least one case, an employee had multiple credit cards with bills paid by the city.

* When it came to special events, such as the city’s Cinco de Mayo festival or its celebration of Mexican Independence Day, the department appears to have ignored city rules for competitively bid contracts.

Councilman Antonio Villaraigosa, who took office 11 months ago and whose district includes El Pueblo de Los Angeles Historic Monument, said he was “shocked and quite frankly outraged that the management and oversight of El Pueblo was in such terrible shape.”

In late May, the department’s general manager, Ed Navarro, resigned. Two other employees were fired or placed on leave in the same week that employees were caught shredding documents. The city attorney’s office and others are investigating, but officials would not comment on their inquiries.

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‘Unconscionable’

Former City Councilman Richard Alatorre, who represented the area in the 1990s, called the situation “unconscionable.” But he said he knew from experience that the department was incredibly difficult to manage. Even before the current troubles came to light, it had had five general managers in the last eight years. “It’s a lion’s den, and most people don’t want to do it,” he said.

According to city legend, Olvera Street is the oldest byway in Los Angeles, marking the spot where a ragtag group of settlers from the present-day Mexican states of Sonora and Sinaloa founded Los Angeles in 1781. (In truth, the city actually sprang up a few blocks away but moved near Olvera Street after a disastrous flood.)

Throughout the 19th century, the street flourished under Spanish colonial rule and then as part of Mexico. But by the early 20th century it had become a haven for the city’s poor and dispossessed.

Then, in the late 1920s, a San Francisco woman named Christine Sterling became enchanted with the Avila Adobe, the oldest existing house in Los Angeles. She dreamed up the idea of saving the building and turning the area into a “Mexican marketplace.”

On Easter Sunday of 1930, the market opened, and it was an immediate hit.

Officials estimate that it attracts up to 2 million visitors a year. Olvera Street has also become a center for Mexican culture in L.A., a place where politicians seeking Latino votes flock for photo ops, where families celebrate important events and protesters mass to make their views known.

“There’s no other place like El Pueblo. It is a microcosm for the city, its politics, its culture, its memory,” said William Estrada, the curator of El Pueblo, who has written extensively on Olvera Street.

But beneath the festive atmosphere, discord among merchants has simmered for years. Merchants offer varying explanations, but some blame a fight between Alatorre and county Supervisor Gloria Molina for exacerbating tensions.

The two titans of Eastside politics fought in the late 1980s and early ‘90s -- when both were on the City Council -- over how best to modernize the monument, which had been managed jointly by the state, city and county. The merchants were drawn in on either side, and the dispute grew so charged that other city politicians had to think carefully about which restaurant to eat in, lest conclusions be drawn about their loyalties.

In 1990, Molina, who now represents the area for the county, and Alatorre reached a deal, promising to upgrade and revitalize the monument as a historic jewel.

Today they agree that the city, which has sole possession of El Pueblo, has neglected it.

And the citizen commission that oversees the department is beset by its own problems. Commissioners complain that a recalcitrant staff failed to heed their orders or even give them the basic information they needed to guide the department. But they have also fought so much with each other that at a meeting last month, commission President Mike Gatto pleaded for professionalism. Instead, fellow commissioners questioned each other’s ethics and passed around personal e-mails, as the new acting general manager, Rushmore Cervantes, watched in astonishment. “The whole dynamic here is really quite interesting,” he said a few days later.

Cervantes, a former official in the city Department of Aging, said he was approaching his job with “a clean slate” and trying to apply sound management principles. This week, city officials plan to begin negotiating leases with some of the tenants who lack them. Many merchants, who remain largely divided, nevertheless seem united in their anger at the city’s stewardship and hope it will start taking better care of its history. “This is a landmark that belongs to the citizens of Los Angeles,” said merchant John Garcia. “It’s totally insane that things are dealt with and handled this way.”