L.A. Prepares Bid for Federal Poverty Funds : Aid: The city’s application for ‘empowerment’ status, due to HUD by June 30, awaits council approval.

An application to establish an “empowerment zone” that would provide federal aid to poverty-stricken communities from Pacoima to Watts was approved Monday by two committees of the Los Angeles City Council.

The voluminous application approved by a joint meeting of the council’s Economic Development Committee and Housing and Redevelopment Committee is scheduled for final council action Wednesday.

The application is due to the U.S. Department of Housing and Urban Development by June 30.

Because of last-minute snags, city officials drafting the application have been scrambling to meet the fast-approaching deadline. But they said they expect to submit the application in time.

“These (snags) will probably be worked out by tomorrow,” Marilyn Lurie, a director in the city’s Community Development Department, said after the meeting.

If HUD officials approve the application in September, the communities within the empowerment zones would share $100 million in special aid and federal tax breaks.

Empowerment zones are the centerpiece of President Clinton’s urban revitalization program. Only six zones will be approved nationwide, and each will be limited to a 20-square-mile area with no more than 20,000 residents. In addition to the empowerment zones, the program establishes 65 smaller “enterprise communities,” each receiving $3 million in funds for social services programs.

The city is proposing four enterprise communities, covering an area centered in south Los Angeles.

Among the problems faced by city officials drafting the application, Lurie said, is that the federal government requires specific details on how the federal money would be spent to reduce unemployment, blight and poverty. She said officials had until recently believed they needed only to provide general ideas on how the money would be spent.

She said they have been working to provide those details.

The other problem has been that the state government wants the city to give it 2% to 5% of the funding if the application is approved, to reimburse the state for the costs of processing the federal money and passing it on to local officials.

Lurie said the city doesn’t want to pay the “administrative fee” and has been told by HUD officials that the application may not be as competitive against proposals from other cities if the state diverts some of the funding.