Zoned for Reprieve : Permits: Board grants exemption to a costume shop operating illegally out of a house. Advocates say the ruling is a small victory for people who now must run home businesses clandestinely.

Judy Corbett’s days as a lawbreaker are finally over.

After eight years of operating a costume-making business out of her North Hollywood home in violation of city zoning laws, Corbett was given a temporary exemption from the statutes last week by a city zoning appeals board.

“Usually, you think about bad guys circumventing the law,” she said. “I’m just trying to get a business going.”

But Corbett’s reprieve is only for two years. If she continues operating her shop after that she will once again join the growing ranks of other home-based businesses in Los Angeles that violate a ban against commercial ventures in residential areas.

Still, advocates of home businesses call her reprieve a small victory in a battle that could otherwise have ended with authorities locking her out of her own business.

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There are no estimates on how many home-based businesses like Corbett’s operate illegally in the city of Los Angeles. But about 2,500 residents each year are turned down by the city’s Building and Safety Department for permits to operate businesses at home. The only exceptions are doctors, dentists and ministers.

Although many cities in Southern California--including Santa Monica, Torrance and Redondo Beach--have adopted regulations to permit home-based businesses in residential areas, an effort to draft similar regulations for Los Angeles has floundered for nearly eight years.

And some planning officials say it is uncertain whether the regulations will ever be adopted.

“It may never come to the Planning Commission,” City Planner Cora Smith said. “It’s a whole can of worms.”

Planning officials who are trying to draft the regulations say they are torn between the need to create more local jobs and reduce commuting, and the fear of letting home-based businesses turn quiet residential neighborhoods into noisy commercial zones.

Violators of the residential zoning laws are prosecuted only when neighbors complain. But city officials say such complaints are rare, perhaps one or two a year.

The effort to regulate home-based business in Los Angeles started in 1985 when former City Councilman Howard Finn asked the city’s Planning Department to draft regulations to allow such enterprises in residential areas.

But it was not until 1990 that the city held its first public hearings on the proposed regulations. The idea was harshly criticized by residents and planning officials, who said the proposed rules were too liberal. Since then, the regulations have been shuffled among various planning officials for adjustments and revisions.

Although the proposed ordinance remains in limbo, the topic continues to generate heated debate among homeowner groups, planning officials and business owners.

Opponents say they fear that allowing home-based businesses would ruin the character of residential neighborhoods by increasing traffic and noise. Unless strict restrictions are adopted, they say, the city should continue to prohibit such businesses.

“If a neighborhood is zoned for residential, we don’t want business operations out of there,” said Richard Close, president of the Sherman Oaks Homeowners Assn. “Where do you draw the line, one employee, two employees?”

Regulating labor laws and the use of toxic materials is difficult in home-based businesses, planning officials say. They worry that if some business are allowed in residential areas, the situation will snowball out of control.

“If you put a limit, people will always want a little bit more,” said Daniel Green, a city associate zoning administrator.

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Proponents of the idea of legalizing home-based businesses say it will establish fertile soil for the growth of new enterprises, thus bringing the city hundreds of thousand of dollars in license fees and taxes. In addition, they say, home-based businesses reduce smog by curbing the need to commute.

In other cities, where such businesses are legal, officials report few problems.

Torrance charges a one-time $109 fee for home-based business permits. If such fees were charged to each of the 2,500 residents who apply annually for home-based business permits in the city of Los Angeles, it would add $272,500 each year to city coffers.

The statutes adopted by other cities to permit home-based business generally prohibit employees other than the residents and set limits on visits by customers, on traffic and on noise. In short, a business must be compatible with the neighborhood.

Paul Edwards, who has written five books and is host of a radio program on home-based businesses, said that if the city does not adopt regulations to permit home-based businesses, such enterprises will simply move to cities that do permit them, taking valuable taxes and fees with them.

“This is one of the major trends in the economy,” Edwards said.

Indeed, home-based ventures are the 1990s’ return to cottage industry.

New technology, a rise in dual-income households and a general trend toward downsizing businesses has helped the number of home-based businesses grow at an annual rate of 10% since 1988, according to Link Resources, a marketing research firm that conducts an annual work-at-home survey.

This year, the survey found that about 4 million full-time and part-time home businesses operate in California. Nationwide, 24.3 million Americans operate home-based businesses either part time or full time.

The trend prompted state Assemblywoman Debra Bowen (D-Torrance) to draft legislation last year to require every local jurisdiction in the state to adopt regulations permitting home-based business.

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Although Bowen’s bill won a wide margin of approval by the state Assembly and Senate, it was vetoed by Gov. Pete Wilson, who said at the time: “I do not believe that this problem warrants the establishment of a new state mandate.”

Bowen said she got the idea for the bill when she worked as a lawyer and unsuccessfully tried to get a permit from the city of Los Angeles to work out of her home.

“It never made any sense to me that the city of Los Angeles doesn’t license businesses like this,” she said. “I really wonder how much business taxes the city of Los Angeles is losing.”

The head of a profitable mail order business that he operates out of his home in the San Fernando Valley said the issue for him is not proceeds for the city or lower costs for him, but convenience. The business owner, who asked not to be identified for fear he would be caught by the city, said he ran his business out of a storefront building for six years, but moved part of the operation to his home because it cut his driving and left his schedule more flexible.

But he must now operate clandestinely, he said, never letting his customers--or city officials--know that he works at home.

“There must be thousands of people who would like to be legitimate and hang that permit on the wall and not worry about that phone call or that knock on the door,” he said.

In many ways, Corbett’s case is more typical of home-based business in Los Angeles--she was motivated by the savings it could provide.

For years, she and her husband ran J & M Costumers from a storefront shop on Sunset Boulevard in Hollywood, creating costumes for television and movie studios.

But after her husband died, Corbett began in 1986 running the business out of her home, she said, because it was less expensive and she felt more secure working at home.

The costume shop employs four part-time workers who use five sewing machines in a garage and a shed adjacent to her single-story home next to the Hollywood Freeway.

When Corbett originally changed her address on her business license, the city notified her that she was violating the residential zoning laws and ordered her to close her business. But the city never followed up and even renewed her business license in following years. Last year, she paid $1,400 for a business license so, she said, she figured she could continue working out of her home.

Corbett said her neighbors never complained about her business. But last year, after a family dispute, her oldest son alerted the city to her operation.

What makes Corbett’s case unusual is that even after a zoning administrator ordered her to close her business, the Board of Zoning Appeals gave her a temporary exemption.

At a hearing last week, the board members at first seemed ready to rule against Corbett. “If you operate out of your home and I operate out of my home, wouldn’t that change the character of the neighborhood?” board Chairman Peter M. Weil asked. “Where do you draw the line?”

But Corbett won the board over, telling them she would be forced out of business if she could not work out of her home. She added that she runs the Neighborhood Watch organization in her area.

“If everybody was as good a neighbor as I, the city would be a much safer place,” she said.

Eventually, the board members agreed that the culprit was not Corbett but a set of outdated and overly restrictive zoning laws. They imposed restrictions to keep Corbett from expanding her business and urged her to lobby the City Council to permanently change the regulations.

Corbett says she has accepted the board’s challenge and will begin working to make other home-based business legitimate in the eyes of the city.

“This is not the time to lose momentum,” she said.