The Community Redevelopment Agency board voted unanimously Thursday to spend as much as $6 million to buy Los Angeles Theatre Center and transfer title to the city’s Cultural Affairs Department.
The action now goes to the City Council for the final decision.
“This is a close-out piece of business for us,” said CRA chairman Jim Wood, who also used the occasion to disband the CRA’s LATC committee.
The CRA has spent more than $20 million since 1978, building the theater and supporting facilities costs as part of the CRA’s redevelopment of the Spring Street area. If the City Council now assumes responsibility for the facility, CRA involvement will end--following its final expenditures of up to $5.25 million to pay off bondholders and $750,000 on transition maintenance costs.
That $750,000 is more than the $300,000 in transition expenditures that were proposed by Mayor Tom Bradley at a press conference last month, when Bradley said that the money would come from the Cultural Affairs Department. But now the CRA plans to pick up the transition costs, channeling $300,000 of the total amount through the Cultural Affairs Department and adding an additional $450,000 to the city’s building maintenance fund, designated for future capital improvements on the LATC structure.
City Councilman Zev Yaroslavsky suggested Wednesday that the city could save money by not paying off the LATC bondholders, instead buying the theater at a foreclosure auction. He said the savings could be used to fund an endowment for LATC.
Wood responded Thursday that Yaroslavsky’s plan would trigger potentially costly litigation from the bondholders and “there is always uncertainty about the outcome of litigation.” He argued that such a move also might create “a certain amount of damage to the credibility of the city and the CRA.”