Council Conflict Averted : Jobs: Walters drops idea of a South L.A. plant built under ‘Buy American’ law. Compromise gives preference to contractors based in riot area.

City Councilwoman Rita Walters averted a council showdown Tuesday by backing away from a proposal to use the “Buy American” law to encourage construction of a garbage bin plant in her South Los Angeles district.

Instead, Walters won approval from the council for a compromise giving a 10% bidding preference to firms willing to build such a plant in an area roughly bounded by 6th Street on the north, Manchester Avenue on the south, Western Avenue on the west and Alameda Street on the east.

About two-thirds of the area is outside Walters’ 9th District, which has high unemployment and suffered $200 million in structural damage during the riots.

“One important message of the civil unrest is that the city can’t go back to business as usual,” Walters said. “I’m hopeful that the companies that do bid see fit to locate a plant in the impacted area.”

At stake are $42 million in contracts to produce up to 800,000 60-gallon bins over the next two years. They would be distributed to residents for use in the city’s automated collection program for refuse and yard trimmings.

The city currently holds five contracts for such containers--none with a Los Angeles-based firm. Those contracts expire in November, city officials said.

A week ago, the council approved an interim bid for up to 200,000 of the containers, which will satisfy city needs until the larger contracts are awarded in October. The interim contract is not subject to the guidelines approved Tuesday.

Felicia Marcus, president of the Board of Public Works, said Walters’ proposal, approved on a 9-4 vote, was a significant step toward rebuilding riot-torn sections of the city.

“It showed the council was willing to put its money where its mouth is,” Marcus said, “by using its purchasing power to encourage the creation of local jobs at a time when we need them most.”

Critics had argued that the idea might have violated certain provisions of the recently passed “Buy American” law.

Councilman Zev Yaroslavsky, for example, noted that Charter Amendment G was crafted to give bidding preference on city contracts to California and Los Angeles County firms--not to companies based in a specific part of the city.

Other council members, including Joan Milke Flores, Richard Alatorre, Nate Holden and Hal Bernson, suggested that it was unfair to favor one section of the city in awarding lucrative city contracts. All four would have preferred to see the plant constructed in one of the city’s five enterprise zones.

“We have to fight to keep business here in Los Angeles,” Bernson said. “These zones already exist to help us do that.”

But Walters said it is critical that the city channel economic development into sections of Los Angeles most affected by the riots.

“The council made an important statement to the people of this city, and in fact the entire nation,” Walters said, “that Los Angeles intends to put its economic clout to work in helping to encourage new industry and jobs in South-Central Los Angeles.”