Riordan’s Energetic Agenda Faces Its Toughest Challenge : City Hall: Despite gains, economic development remains elusive. Mayor says he has laid groundwork for change.

When he took the oath of office, Richard Riordan carried a promise of renewal for “a city in need of safety and economic opportunity . . . a city desperate for hope.” At the six-month mark of his tenure, the mayor of Los Angeles is winning praise for strides on the first and last themes.

In a bleak period of budget retreat, Riordan managed to scrape together the down payment on an ambitious crime-fighting plan that could noticeably increase the number of officers on the beat by summer. And many observers say that the mayor’s energetic agenda and expressions of hope have helped revive expectations that the city’s future can be brighter than its recent past.

But at the turn of the year, interviews show, there is also a growing sense that the new mayor must pick up the pace on his inaugural’s most difficult theme: stimulating job creation and business opportunities.

“He has changed the chemistry and changed the dynamic in the community,” said Los Angeles political consultant Rich Lichtenstein, who often represents business interests at City Hall. “Now he has to take some substantial initiatives to get some economic turnaround . . . or he will lose the momentum.”

“I’m not hearing from them a clear sense of what jobs they’re looking for (or) what they are looking for (generally) in terms of economic development,” said Councilwoman Ruth Galanter, who heads a key committee that oversees the city’s business-oriented agencies.

Fresh from a skiing vacation in the Idaho Rockies, where he could savor early successes, Riordan has returned to the dark-paneled reality of City Hall and the enormous challenges ahead. Chief among them is devising a politically viable, balanced budget and freeing up nearly $100 million more for the second phase of his five-year effort to expand the LAPD by 40%.

In an interview, Riordan was upbeat about the progress he has made and the prospects for working through the difficult issues ahead.

“The main thing I’m proud of is the people I’ve brought here,” he said. “It’s like building a building. You first hire an architect. You then put up a foundation, and you don’t see too much. Then all of a sudden, within a few days, you put up the superstructure and people see significantly more than they have seen for the last year.”

The legacy of this Administration, many analysts and elected officials believe, will be written more in the coming six months than in the last. Looming for Riordan are defining battles over new union contracts, whether private firms should provide some public services, and a controversial effort to tap into funds going to a large Department of Water and Power workers pension fund. And financing Riordan’s police buildup could require unpopular cuts in other services such as libraries and parks, some officials believe.

The outcome will turn in large part on how effectively the mayor exploits the new chemistry he has fostered, and how he builds on the initial policy advances he has won.

Implementing Riordan’s core agenda--curbing street violence, creating jobs and streamlining government--hinges on the uncertain willingness of the City Council to go along with his initiatives.

To that end, Riordan has invested heavily in the politics of schmooze and nurturing personal ties with council members.

In contrast to the often aloof, enigmatic former mayor, Tom Bradley, Riordan has injected a new gregariousness into the City Hall political equation. He has invited the entire council over to his house for dinner, played golf or ridden mountain bikes with council members, and attended public “Meet the Mayor” sessions with them from one end of the city to the other. He calls often and, in a reflection of the new equanimity, sometimes wanders into a council member’s office for a chat.

“It’s just my style,” Riordan said. “I’m comfortable. . . . I’m learning a lot by talking to them.”

When Galanter let it be known that she was “really miffed” with the mayor’s office a few months back, three calls came in quick succession from Riordan and two lieutenants. The issue now escapes her, she said, but not the response. “The mayor’s operation was very careful to try to repair that,” she said.

What all the attentiveness and political courtesy buys Riordan is unclear. Members have shown a willingness to deal the new mayor embarrassing defeats--such as spiking a fund-raising scheme that would have transferred title of the historic Central Library to a tobacco company affiliate.

Riordan advisers concede that they still have no natural, reliable council majority. They plan to hunt down votes one by one, issue by issue. But Riordan Chief of Staff William McCarley said he is “optimistic we’ll be able to generate enough support to get a large part of Riordan’s program” implemented.

Riordan agreed. “Generally, I think the one thing I have going is that virtually all of the City Council trusts me.”

But with so much of Riordan’s financial and City Hall restructuring plans still unknown, even to top mayoral advisers, others are more cautious. One mayoral adviser privately described the police funding and deficit problems as “the big engine coming down the tracks at us.”

Still, many say Riordan’s personal demeanor, his political popularity and a general feeling that the city must be moved beyond riots and recession are playing in the mayor’s favor.

“He has people pulling for him because they feel that his success will become their success,” said Councilman Zev Yaroslavsky, the city’s budget expert. “The council feels we have nothing to gain by scoring political points.”

Whether he is appearing on national news interview programs or taping an introduction for a sports bloopers television show, Riordan has reached out to a varied audience.

The 63-year-old millionaire mayor has been a voice of tireless optimism, sometimes expressed in the unpolished manner of a neophyte politician. He also has demonstrated an appetite for unconventional thinking--science fiction master Ray Bradbury recently brainstormed with Riordan about transportation and city planning issues. Some observers say those characteristics have come through in his public persona and seem to have struck a chord with much of the city.

“He’s saying the basic truth: That L.A. is not doomed . . . (it’s) going to turn around,” said Joel Kotkin, a senior fellow at the Center for the New West, a public policy think tank. “He’s saying it’s a city with problems, but a city with huge promise.”

What has been conspicuously lagging, Kotkin and others say, is a cleareyed scheme for attacking the malignancy of high inner-city unemployment, middle-class job losses and rebuilding an economy battered by defense cuts.

“I’m certainly waiting for the type of jobs he has envisioned for unemployment problems,” said Mark Whitlock, who directs an economic development program associated with the First African Methodist Episcopal Church in Los Angeles. “And I’d like to see a candid discussion of what the Administration’s vision is for rebuilding South-Central Los Angeles.

“The problem’s been around for the last 30 years, so I can’t say six months is too (long). But I don’t think we can afford to wait another six months.”

Riordan said that realistically, economic help for inner-city residents may have to come in the form of jobs located elsewhere, and transportation improvements to carry workers there. “Those businesses can be anywhere in the city,” he said. “I think somehow RLA and everything concentrated too much on where the jobs were created, as opposed to the goal of the job.”

Some City Hall and Administration sources say that Riordan was set back by the rocky tenure of Alfred Villalobos, his deputy mayor for economic development who resigned last month after a series of disclosures about a checkered business past. Riordan aides say it will be weeks before a new economic development czar is in place.

But McCarley, the mayor’s chief of staff, denied that Villalobos’ service or departure delayed the mayor’s economic planning. He said it is unrealistic to expect a full-blown economic development plan so soon.

“That is the most difficult, least defined and hardest area to have an impact on,” he said.

Riordan said he is leery of producing a huge plan that raises false expectations. “I’m not a bull artist. When you start talking about magic bullets you’re giving people an impression of doing much more than you’re capable of doing.

“The Riordan economic program to turn L.A. around is to make it safe and friendly. Business is going to go where it’s in their self-interest to go,” the mayor said.

A number of studies are under way to determine how best to leverage state and local federal funding to help small businesses, and how to improve the transportation system to get the unemployed to areas where jobs are more readily available, McCarley said.

Riordan and his aides emphasized that the mayor has made calls to deter individual businesses from leaving Los Angeles, including Packard Bell, a computer company in Chatsworth.

George Mihlsten, a prominent Downtown lawyer, said Riordan contacted two of his clients--whom he declined to identify--and aides followed up aggressively in an effort to keep the companies and several thousand employees in the city.

“For the first time in the history of the city, the mayor’s office is going out and aggressively pursuing companies that are thinking of leaving,” Mihlsten said. “This is a major change for the city of Los Angeles, to begin acting like other cities and competing for employers and jobs.”

Riordan has also appointed a new Administration official charged with making it easier for the film industry to remain in the city. And a committee of heavyweight developers is drawing up a plan for reducing paperwork and delays for new construction projects.

There have been signs of a new business acumen and agility in the Riordan Administration. They include the much-publicized standoff with the airlines over higher Los Angeles International Airport landing fees, a hard-nosed renegotiation of a huge Alameda Corridor transportation deal and, with unusual speed, putting together a deal for a new police training and communications facility that will save $50 million.

In an early, bitter showdown with the airline industry, the Administration won a key legal and political victory that will permit the collection of tens of millions of dollars in new levies.

Elsewhere, Riordan and his harbor commissioners tossed out a previously negotiated, $260-million Bradley Administration agreement to purchase Southern Pacific railroad rights of way. The rights of way are crucial to a huge, harbor to Downtown shipping corridor that will create thousands of jobs and relieve congestion and delays.

By December, the purchase price had been renegotiated to $240 million and Riordan estimated that the agreement shaved about $80 million off the overall costs faced by the Los Angeles and Long Beach ports.

The full savings is impossible to know until the $1.3-billion project is completed, but even Southern Pacific’s attorney, Tom Houston, grudgingly concedes that the new Administration cut a better deal for itself.

The savings were clearer on the recent Police Academy deal--the sort of multimillion-dollar opportunity the businessman in Riordan understood.

After years spent studying construction of a facility in Sylmar, the LAPD was approached by a young real estate agent with a cheap and speedy alternative--a modern, 14-acre campus-like corporate training facility in Westchester.

The LAPD quickly deemed the site ideal, but other bidders were making offers for the complex, and City Hall’s lumbering bureaucracy would have to move quickly or the deal could be gone.

At the initiation of Galanter, who represents Westchester, Riordan was given unusual negotiating authority by the City Council and went into deal-making mode. He called up the corporate officials who were selling the property to secure the city time to make a bid. Then he reached outside City Hall to volunteer attorneys and real estate experts who could quickly analyze and negotiate a deal.

Seven days later, city officials were counting up $50 million in estimated savings and planning to begin the first classes at the new facility in a few months--more than two years sooner than once anticipated.

Although the $13-million Police Academy deal has been widely applauded, it also highlights a recurring concern about the new Administration. As Riordan relies on experts in the private sector to help conduct important city business, opportunities for conflicts of interest grow and the outer limits of ethics regulations are being tested.

There has been no indication of impropriety, but the attorneys and real estate developer brought in to the Police Academy deal were not covered by normal conflict-of-interest disclosure rules for city officials who negotiate such contracts.

Political scholar Xandra Kayden, past executive director of the commission that drafted the city’s ethics laws, said such arrangements can be beneficial, but also pose risks. “The main priority of government is not to be efficient,” she said. “The main job of government is to be fair. And that’s where you can’t be sure when things are moving so quickly.”

Riordan advisers say the mayor did what just he was elected to do--save taxpayers millions of dollars and use his business skills to make government more responsive.

“I think this was the mayor at his finest,” McCarley said. “He was experienced . . . he was able to strip away the bureaucratic delays. This was his element.”

In Mayor’s Own Words: A Look Back and Ahead

In an interview Friday with The Times, Los Angeles Mayor Richard Riordan discussed his first six months in office and what lies ahead. Here are some excerpts:

Accomplishments: We’ve just got an incredible group of people together. And that means both full time plus volunteers who have spent hundreds, sometimes over a 1,000 hours, working for the city. The planning, the hard work that has been put in, the change in culture which is starting to seep through the city. Obviously, Project Safety Los Angeles is a good thing. It’s the first time, I think, in the United States that anyone has had a long-term strategic plan in making major changes in the Police Department. Within five years, starting last July 1, it will increase the number of police in community-based policing and on the streets five times.

Budget Battles Ahead: We have to find the money (for police) because we absolutely do not have a choice. If you don’t make the city safe, the tax base is going to shrink and you’ll have less money to do anything. The obvious places to look are some of the proprietary departments, such as DWP, the airport, harbor, public works in the long run. You can’t go much further on some of the libraries (and) parks. You can’t cut them anymore. (He declined to discuss details of his upcoming budget balancing plan.)

Economic Development: We’re working with the state and federal governments, working to set up community banks, to set up a bunch of capital pools. We’re working very closely with the (federal) government on setting up an empowerment zone. By the same token, all those things put together are just frosting on the cake. People don’t want to move businesses into a war zone. They don’t want to be in a city that has been just incredibly unfriendly to business, particularly small business. And that’s where you are going to turn this city around economically. Once you have improved the infrastructure for business, it will just pour in here out of self-interest.

And (we must) build on our strength: the entertainment industry. If we could increase the number of pictures produced in L.A. 10% over the next year, it would be the same as bringing in several hundred small companies. (In the) long run, you’re not going to get major manufacturing operations that are labor intensive into the city of L.A. You need high-tech jobs that are not as labor intensive. A lot of the biomedical, electronics, things like that.

Conditions in South-Central Los Angeles: I’ve tried to step back and say what can we do better or differently, and the one thing I’ve come to a conclusion on is the ultimate goal has got to be jobs in the inner city. And the way you get jobs, obviously, is you have business that will hire you. And that business can be anywhere in the city, provided that they are willing to hire people from the inner city or any place else in the city. I think somehow RLA and everything concentrated too much on where the jobs were created, as opposed to the goal of the job. First, you have to encourage business to hire people from all parts of the city. Secondly, people have to have access and transportation to and from the jobs, which they don’t have today in many cases. And third, they have to have the tools to do a good job, such as a good education, which in many cases they don’t have. We are working on all those very hard. I’ve been after improved busing. And education, that’s been my whole life.

Sizing Up the Mayor

A sampling of views on the performance of Los Angeles Mayor Richard Riordan.

“He has had an extraordinarily long honeymoon. In large part that is because people don’t think he is in it for himself. They see him giving his time . . . to help the city.”

--Councilman Zev Yaroslavsky.

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“Everyone accepts that he has had some victories and he is serious about the issue of crime. Now it’s time to use his honeymoon to accomplish some other things on economic development and on privatization.”

--Nick Patsaouras, a candidate in last year’s mayoral primary.

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“He has been able to do a better job in a lot of ways with the council than Mike Woo would have. Mike would have brought a lot of history with him and Riordan has been able to say, ‘I don’t have the history, let’s get going.’ ”

--Lawyer and lobbyist Douglas Ring.

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“Our community, more than any other, lives with crime and violence. The fact that public safety is No. 1 on his agenda every day really strikes a chord. And his close relationship with (Police Chief) Willie Williams is well received.”

--African American political consultant Kerman Maddox.

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“He has to come out and articulate a vision of the economic future of Los Angeles. He has not done that yet.”

--USC professor Kevin Starr, a specialist in urban politics and culture.