Long Beach : Village of Lost Revenue

Lax administration of the city’s lease with operators of Shoreline Village, a 46-shop showplace on the downtown waterfront, has cost the city at least $96,000 since it opened in July, 1983, the city auditor has reported.

The city has lost the money mostly because Specialty Villages, operator of the dining, amusement and shopping development, negotiated subleases with tenants that conflicted with its master lease with the city, City Auditor Robert E. Fronke reported.

Despite the lost revenue, city income from the development was up 8.6% last year to about $491,000, the auditor said.

Fronke said that about $74,000 was lost to the city because Specialty Villages incorrectly classified gross receipts. Another $9,902 was lost because the village operator used the wrong percentage rate in calculating the city’s share on boat charters, Fronke said.

The auditor noted six other problems that had cost the city at least $12,000 and also raised the possibility of more lost revenue due to substandard record-keeping by some businesses. Also, 10 of the 46 shops could not prove that they had insurance, he said.

Fronke also said that parking remains a severe problem at Shoreline Village, maintenance and cleanliness are sometimes not sufficient and that advertising should emphasize retail shops as well as entertainment.

The city Tidelands Agency, which administers the specialty village, said in a written response that several of the problems had been or are being corrected.

A spokeswoman for Specialty Villages said she would meet with the Tidelands Agency to discuss the auditor’s findings.