Rebuild L.A. Stumbling Over Red Tape, Factionalism : Riot aftermath: Group struggles to define itself and what it can accomplish. But its leaders remain optimistic.

Peter V. Ueberroth--the can-do businessman tapped by Mayor Tom Bradley to transform inner-city Los Angeles--is often frustrated and occasionally discouraged these days.

Though pleased with Rebuild L.A.’s early work, the former baseball commissioner and Olympics czar acknowledges that the private organization can claim no major accomplishments to date.

“The obstacles are much more formidable than I thought,” Ueberroth said. “There’s no home run yet.”

His dismay reflects the problems that beset Los Angeles nearly six months after the city erupted: a virulent recession, government gridlock and a Balkanized city.

Far from overcoming those obstacles, Rebuild L.A.--created in a caldron of crisis--has yet to define itself, let alone demonstrate that it can deliver.

“Rebuild L.A. is still struggling to figure out what it can do as an entity and what it should be doing,” said attorney Abby Leibman, an early critic of the organization who is a member of its health and human services task force.

Ueberroth says the blame stretches from Los Angeles to Washington.

Since the spring riots, “government has not done anything meaningful to help rebuild Los Angeles,” he said, adding that promises made by Democrats and Republicans alike have not been honored.

“I don’t expect to get everything,” said Ueberroth, expressing shock at the lack of help from the federal government beyond short-term emergency aid. “But this is an arrogant, non-caring reaction.”

Ueberroth has frequently criticized state government, but this is the first time he has been so critical of Washington, where President Bush says he will veto an urban aid bill that, while diluted, would have provided millions of dollars to Los Angeles.

The veto would not only preclude expansion of the “enterprise zone” program, but would also deprive California of $38 million in tax credits for low-income housing next year and perhaps millions more during the next decade, said Denise Fairchild, an expert on affordable housing.

Closer to home, Ueberroth expresses surprise and disgust at “the number of local religious, political and community leaders” who, he contends, “are resistant to change because they get their power through distress in the inner city.” He declined to identify anyone, but said his criticism applied across racial lines.

Ueberroth maintains that he is not trimming his sails; he still believes that RLA, as the organization likes to call itself, can play a key role in revitalizing the city’s neglected areas. Among its key goals, he says, are providing greater opportunities for minorities to own businesses, obtain good jobs, shop in markets with fair prices and live in safe neighborhoods.

And he is enthusiastic about the support that Rebuild L.A. has gotten from residents, businesses and community leaders, many of whom express a “give them a chance” attitude when asked about the organization.

But Rebuild L.A. is hardly a well-oiled machine, according to several board members, including Warner Bros. Vice President Dan Garcia, City Councilman Mark Ridley-Thomas, and others, who spoke on condition that they not be identified.

Among the problems cited: The cumbersome process of getting three co-chairmen to agree on major decisions. Poor communication between the 48-member staff and Rebuild L.A.’s 67 board members. And the difficulty of melding a team from a staff of full-time and part-time workers, virtually none of whom have worked together before.

Moreover, Rebuild L.A.’s leaders have consistently said that the organization’s primary work would be done by task forces made up overwhelmingly of volunteers. But the logistics of assembling them for meetings is not simple, said Co-Chairman Bernard W. Kinsey, a former Xerox executive. Some of the panels will meet for the first time this week.

David Friedman, a lawyer with close ties to the region’s emerging cadre of Latino and Asian-American manufacturers, said that Rebuild L.A. is gridlocked and that it has fundamental defects going well beyond start-up problems.

Its strategy, he says, is flawed economically and politically. He contends that its leaders spend too much time bashing government regulation of business and attempting to appease various constituency groups.

Rebuild L.A., Friedman said, brings together “the worst responses the American system typically raises to periods of crisis--the slash-and-burn business response of the right and the entitlement strategy of the left.”

Carlton Jenkins, managing director of Founders National Bank, the city’s only black-owned bank, said Rebuild L.A. is having difficulty generating momentum, partly because it is trying to develop a grand scheme of meaningful solutions.

“Coming up with something new and innovative takes longer,” he said. “I don’t begrudge them that they haven’t put 35 million people to work.” Nonetheless, Jenkins said he is disappointed that Rebuild L.A. seems slow in using some of the money and financial commitments it has received.

Ueberroth makes no apologies for the pace of the group’s work, even though he, too, wishes it were going faster. “It took 40 years to wreck the inner city,” he said. “It’s important to take the proper time to cure it. There will be no second chances.”

In fact, some officials have attempted to lower their expectations in recent months, said board member Leo Estrada, associate professor at the UCLA Graduate School of Architecture and Urban Planning.

“Little by little, they’ve disappointed some, discouraged others, made people understand their limitations and constraints,” Estrada said.

Co-Chairman Barry A. Sanders, an international lawyer, acknowledges that Rebuild L.A. has been so quiet in recent months that friends have asked him “if we’ve blown it.” He says he quickly reassures them the answer is no.

Last summer, the low profile was intentional. Ueberroth had previously appeared at a series of news conferences, sharing the dais as Vons announced plans to build urban supermarkets and Hughes Aircraft, a General Motors unit, pledged to open a small facility in the inner city. City Councilman Michael Woo also credits Ueberroth with helping persuade Sears to rebuild its riot-damaged Hollywood store, one of numerous “damage-control” efforts Rebuild L.A. has undertaken.

But then the organization virtually went underwater in an attempt to firm up its internal operating procedures, get a dozen task forces up and running and meet with businesses that have made development proposals, Sanders said.

The finance task force began formulating plans for an inner-city development bank and an investment fund, both designed to generate capital for small and medium-sized businesses. It hopes to launch the fund in the first half of 1993.

“We’re moving as fast as we can,” said task force Chairman Cody Press, manager of Merrill Lynch’s western region public finance group.

Although Ueberroth has said that Rebuild L.A.’s focus primarily will be economic, a racial harmony and discourse task force will convene this week.. Rebuild L.A. leaders say conditions in the city make such a task force necessary.

“It’s important, it’s fundamental,” Sanders said. “Balkanization is real. You can’t ignore this subject.”

The panel will be headed by Police Chief Willie L. Williams, Mexican American Legal Defense and Educational Fund Director Antonia Hernandez and Korean-American architect Ki Suh Park.

Indeed, among the many problems confronting Rebuild L.A. are persistent complaints that it has not been sensitive to the concerns of some of the city’s myriad of ethnic groups--especially Latinos.

In particular, Ueberroth, Kinsey and Sanders are under pressure to appoint a Latino co-chairman who would share power with them.

“There is still a lot of concern among Latinos that they are not being paid enough attention by RLA,” said Warner Bros. executive Garcia, one of 16 Latinos on Rebuild LA.’s 67-member board.

“I view this as unfortunate,” Garcia said. “I don’t think you approach life by quotas and formulas. But there are a lot of Latinos in the city. . . . Rebuild has to identify someone as the co-chair--the sooner, the better. Once that happens, I think a lot of the bickering will cease.”

Ueberroth and Kinsey say a search for a Latino co-chairman is under way; they hope to make a selection by the end of the month. It is possible that an Asian-American co-chairman will be appointed later, Ueberroth said.

But even Rebuild L.A. staff members who share the desire for a more diverse power structure say they fear making the organization’s decision-making process any more cumbersome.

“Getting three guys to sign off on something isn’t easy,” said one staffer.

When Kinsey and Sanders spoke at the Jewish Community Relations Council of Southern California on Friday morning, yet another constituency asserted that they had been neglected when a Northridge attorney told them people in the San Fernando Valley felt excluded from Rebuild L.A.

The two co-chairmen reiterated their frequently stated position that their door is open to anyone who wants to help. They say that 700 to 1,000 people have signed on as members of task forces and that they have offers of help from 20,000 volunteers. Sanders, in particular, acknowledges that Rebuild L.A. has had difficulty figuring out how to utilize volunteers. But he says that a system has been set up to link volunteers with community organizations and that such placements have begun.

Still, in the economic reconstruction that is the heart of Rebuild L.A.’s mission, Kinsey says he is disturbed that more business leaders have not made a commitment to helping the organization or investing in the inner city.

“What’s most discouraging is the business leadership hasn’t stepped forward,” he said. “It’s almost like they feel they don’t have a stake. The whole city has a stake in what we’re doing. . . . If you don’t think so, try to sell your house.”

Kinsey, like his colleagues, frequently criticizes what he considers excessive government regulation of business. But he also says Rebuild L.A. has to deal with the way the diminution of public sector resources has played a role in the decline of the state and local economies and had a particularly adverse effect on the city’s neglected areas.

“How can we ask why our industrial base is declining when California spends $5,400 a year per student and New York and New Jersey spend $9,900,” Kinsey said to the Jewish group Friday. “My son has 63 kids in his geometry class at Palisades High and he’s in an honors program.”

He also warns that it would be very shortsighted of local authorities to reduce bus subsidies because so many of the city’s low-income workers rely on public transportation.

Despite the obstacles, Rebuild L.A.’s leaders say they have not lowered their sights.

At its first meeting in July, a management consultant told Rebuild L.A.’s board that an investment of about $6 billion and the creation of 75,000 to 94,000 jobs were needed to revitalize the city’s neglected areas.

A more detailed economic strategy developed by management consultants McKinsey & Co. will be presented at the board second meeting Oct. 28.

Rebuild L.A. board member Robert Taylor said he and others at McKinsey have been studying a variety of approaches used to revive depressed economies. Serious attention must be directed at the economic strategy pursued by South Carolina in enticing BMW to build a car plant expected to create 2,000 jobs. Critics, however, question the choice of role models.

David Friedman has no argument with upgrading Los Angeles’ work force. But he says it would be a fundamental mistake for Los Angeles to try to copy South Carolina, which he characterizes as “a low-cost, low-wage backwater.”

Regardless of what strategy it settles upon, though, Rebuild L.A. may be trying to go up a down escalator, said Denise Fairchild, Los Angeles director of the Local Initiative Support Corporation.

“We won’t be able to rebuild the city unless there is a new consciousness about making real structural changes,” Fairchild said. “RLA may be swimming upstream against a tide that is moving in the other direction.”