The Next L.A. / Reinventing Our Future : THE ECONOMY : WHAT WORKS
Here are some proposed and existing programs that could set an example for innovative ways to build a stronger economy for Los Angeles and the region:
* Bank of America, which changed its small-business loan underwriting criteria in the past two years to de-emphasize the need for real estate as collateral, says it has already exceeded a three-year goal of lending $1.8 billion to small businesses in California. The target has now been raised to as much as $3 billion.
* A program called Breakthrough, sponsored by the Valley Economic Development Center in Van Nuys, brings 12 small-business operators together to advise each other and to pool money for investment in one or more of the businesses--much like the Korean kye pool approach. The idea: Like-minded entrepreneurs can share ideas and capital instead of going it alone.
* Rather than giving money away in grants for defense conversion initiatives, the federal government should invest in such initiatives, argues Jon B. Kutler, head of Century City-based Quarterdeck Investment Partners. That could attract additional capital to defense conversion efforts, he says. Kutler suggests that the government seed a defense conversion investment fund with $10 million, which would be leveraged with $90 million from pension funds or other investors. The goal: provide capital to small defense contractors struggling to convert to the production of non-defense goods.
* Los Angeles’ adopt-a-school program is already the nation’s largest, but Eiko Moriyama, who directs the program for the Los Angeles Unified School District, said the need is greater than ever--not for money, but for the role models that business people can provide for students via classroom visits, tutoring and other programs.
* A one-stop permit office has been set up in Reseda to help businesses recover from the Northridge earthquake. The office, an initiative by City Councilwoman Laura Chick, puts state and local agencies--such as building safety, environmental health and air quality management--in one location so business owners can obtain permits quickly. Some city officials say the one-stop concept could well be extended to non-crisis periods to lessen the red tape faced by new businesses in Los Angeles.
* The Coalition for Women’s Economic Development, founded in Los Angeles in 1988 to assist low-income women trying to start their own businesses, has since expanded to include training, technical assistance and micro-loans for both women and men. The coalition says that since May, 1989, it has offered entrepreneurial training to 5,000 people and funded 152 loans worth a total of $480,000.
