SOUTHERN CALIFORNIA ENTERPRISE : Streamlining Bureaucracy : New Coalition Is Pushing to Make L.A. More Friendly to Business

An unusual coalition of business, labor and community leaders has formed to help Mayor Richard Riordan in his quest to make Los Angeles the kind of place that business would like to call home.

Named “Progress LA,” the new nonprofit organization is tackling as its first project the city’s unwieldy system for issuing permits to construct or expand a business facility or to build or remodel a home.

“We feel that the reform of city processes is something that really needs to be done to make Los Angeles more competitive,” said Richard D. Farman, chief executive of Southern California Gas Co. and co-chairman of Progress LA. “We absolutely have to change the way we do business at City Hall and the way that City Hall does business with its citizens.”

Progress LA’s other co-chairman, Santa Monica developer Steven L. Soboroff, likens the city bureaucracy, particularly when it comes to issuing land-use permits, to a house that has been painted too many times.

“It’s just one layer of paint on top of another layer of paint,” said Soboroff, who is also president of the Los Angeles Recreation and Parks Commission. “We need to sandblast it down to the primer.”

If all this has a familiar ring, that’s because Riordan has been pushing this issue since he took office in June, 1993. If the city is made more safe for all residents as well as more hospitable to the business community, then jobs will be created and the economy will prosper, the businessman mayor has said.

These are the cornerstones of Riordan’s economic development program. But he has saved his toughest rhetoric for the convoluted system that issues permits--at one point calling it “communistic.”

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Critics contend that when businesses or homeowners want to obtain a permit in the city, they face a complicated and confusing bureaucracy administering rules that are unclear. The process was fine when the city was booming, they contend, but it exacerbated the downturn in construction during the recession and is hindering the recovery.

To determine how best to change the permit process, Riordan appointed a development reform committee shortly after his election and named influential real estate attorney Dan Garcia to head it.

But studying the vast permit bureaucracy is becoming a career in itself. The committee was originally expected to complete its work in three months. Garcia now says he expects to release the report in December, a delay caused by disruptions from the January earthquake and the complex nature of the problem. In addition, the committee decided to do a survey of the permit process in other cities, he said.

What’s more, the committee was criticized by homeowners’ groups who complained of being left out. They fear the committee will remove needed protections as part of the streamlining.

“Everyone can blame it on me,” said Garcia, who is senior vice president of Warner Bros. and the new chairman of the Community Redevelopment Agency’s board of commissioners. Garcia admits he’s getting a little tired of being asked when the report will be ready.

“Everyone wants systemic change but we have a very complicated system and it’s taken me a lot of time to translate the recommendations that we have into understandable change,” Garcia said. “I would rather have it done right than have it done quickly.”

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Getting it done is also motivating the leaders of Progress LA, which is separate from Garcia’s development reform committee, although Garcia serves on the council of advisers.

“There are a lot of reports that wind up on shelves and we want to make sure that these (recommendations) are followed,” Farman said. “It is our belief that the current process hurts not only developers but everyone in Los Angeles, and that includes low-income developers and homeowners as well.”

To dramatize the need for development report--something even Garcia admits is “not exactly a gut-gripping subject”--Progress LA is producing a video of actual permit “horror stories.” The group is comparing the land-use permit process in Los Angeles to that in seven other cities. Progress LA also is surveying the last 500 applicants for permits, both home and commercial, to see what kind of experience they had.

Those applicants “didn’t feel like they were customers,” Soboroff said. “I think they feel like they were enemies.”

Progress LA intends to keep the issue in the public eye and whip up grass-roots support so that changes in the permit system, which will likely become a hot political issue, will get through the City Council, Soboroff and Farman said.

“We have our eyes open,” Farman said. “I think reform is always a difficult battle because it involves change and it involves making certain that the citizens’ interests rather than the interests of the bureaucrats are best served. What makes this a battle that can be won is the recognition in this city today that there is a need for change, that something is broken and needs to be fixed.”

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Soboroff acknowledged that protections are necessary in the permit system.

“People can abuse the system if it’s too easy,” he said. “We’re not trying to make the system easier. We’re trying to make it more predictable. . . . At least you know what you’re getting into.”

“We’re not talking about taking parks and turning them into high-rise office buildings,” Soboroff said. “Our concern is that people will think, ‘Oh no, here come the developers.’ ” To help broaden support for permit reform, Progress LA plans to expand its council of advisers and its membership, which is heavy with business representation, to include more minority and community groups.

The organization’s funding--$600,000 pledged so far--has come almost exclusively from business, although a former financier named Riordan also has contributed.

“It’s wonderful to have a mayor who puts his money where his mouth is,” Farman said. “We’re very proud of that.”

Yes, We Have No Permits

The value of permits issued by the city of Los Angeles has dropped sharply since 1989. Dollar value of permits issued for home and commercial construction, in billions:

1994*: $1.11 billion

Through June: figures reflect eartquake-related construction boost.

Source: L.A. Dept. of Building & Safety