Redevelopment Plan May Aid Social Services : Hollywood: The proposal calls for setting aside 10% of the $900 million generated in redevelopment projects.

A plan to earmark for social service programs 10% of the $900 million that is to be spent on the massive Hollywood redevelopment project is likely to be approved by the city Community Redevelopment Agency and signed into law, redevelopment officials say.

The officials said the plan is the first of its kind in Los Angeles, and perhaps the nation, in which social reform programs are directly linked to a redevelopment effort.

According to the plan, as much as $90 million would be spent over the next 30 years on day-care facilities, medical services, shelter programs for the homeless and runaways, educational and job training facilities and counseling programs.

The plan was approved April 6 by the Hollywood Community Advisory Council, and is now before the CRA board of directors, which is overseeing the effort to revitalize a 1.7-acre swath of central Hollywood.

“It is a good principle and is consistent with what the agency is doing now,” said Carlyle Hall, one of seven CRA board directors and chairman of the CRA board’s housing and social needs committee. “I think the 10% should be a floor, and not a ceiling, for spending on social needs.”

Other CRA officials and members of the community advisory group also hailed the plan and predicted that it would be approved. Hall said the CRA board would start reviewing the proposal within several weeks.

“I think it is very likely (the board) will adopt it,” said Lester Burg, assistant project manager of the CRA’s Hollywood Redevelopment Project. And project manager Cooke Sunoo said that although the project has been tied up in court, the agency has budgeted $350,000 for social-needs programs for the fiscal year that starts July 1.

The Hollywood project, like most redevelopment efforts, is expected to be self-financing in the long run. Initial phases of the project are built with funds borrowed against future tax revenue. If successful, the initial phase of redevelopment then generates enough additional property tax revenue to pay for the rest of the project.

Under state law, 20% of the added tax revenue generated by redevelopment projects must be set aside to create affordable housing. The new plan goes further, setting aside an additional 10% for other social needs--a first for the CRA, Sunoo said.

The community advisory council, which sought input from CRA staff members before approving the plan, determined most of its priorities from a study of social needs in Hollywood that was conducted by an outside consulting firm.

HCAC Chairwoman Torie Osborn said she expects little opposition from the CRA board. She noted that the initial idea for setting aside the 10% came from City Councilman Michael Woo, who represents the area. That idea was incorporated into the redevelopment document approved by the City Council in May, 1986.

“There is nothing like this plan, to my knowledge, anywhere else in the country,” Osborn said. “It is a visionary document.”

What is at stake, and now subject to approval, is exactly how the money will be spent.

The plan does not allocate fixed percentages of funds for specific purposes. Instead, it is flexible by design. The plan is for the CRA to work closely with the citizen’s advisory council and private groups in determining how the money will be spent, Osborn said.

Some residents have criticized the plan as being unrealistic. Among the critics are some members of an elected advisory group that Woo replaced last year as the official advisory panel to the CRA in favor of the Hollywood Community Advisory Council.

At issue, opponents said, is the wording of the Hollywood Redevelopment Plan, which says the agency “shall expend or cause to be expended an amount equal to 10% of the tax increment available to the agency . . . to address the social needs of the community.”

“Where is the 10% guaranteed?” asked community activist Norton Halper. “Not only is it not in the plan, it does not exist.”

Halper said he favors spending on social needs, but he warned that the CRA is “deceiving the community and the social needs groups that think they are going to get a lot of money to put forth their programs, when the money will not be there.”

“It’s a deceptive hoax,” said Halper. He said as much as 70% of the $1 billion ultimately projected for redevelopment would be used to finance the debts the CRA will incur by borrowing money up front for projects.

Halper is a member of the Project Area Committee, the group that was replaced by the HCAC. Though stripped of its official status, the committee still meets once a month.

Woo said the social programs will not have to wait for the redevelopment project to get under way before the money starts flowing. The initial borrowing, he said, will pay not just for construction, but for some of the social programs too.

“Otherwise, it may be many years before these needs are served,” Woo said. “We have got to start generating some money now.”

Lynn Davis, chairwoman of the HCAC’s Housing and Social Needs Committee, acknowledged that such debts would be incurred. “But I don’t think they would be significant enough to dilute the purpose” of the plan to help the community, she said.