A Chance to Repair a Painful Mistake : Congress should sign off on Clinton move to grant Los Angeles an empowerment zone

Los Angeles didn’t lose everything when the Clinton Administration failed to award a much-needed federal empowerment zone to the beleaguered city. As a consolation prize, Washington has promised $125 million for economic development and an additional $300 million in federal loan guarantees from HUD. That one-time allocation is welcome, but it falls far short of a 10-year empowerment zone complete with tax breaks for employers and millions for new social spending in blighted neighborhoods.

Los Angeles’ troubles were exactly what Congress had in mind when it authorized empowerment zones. This region has been battered by a lingering recession, riots, a devastating earthquake and other disasters. The economy may finally be turning around, but neither the private nor the public sector has recovered fully from all the piling-on. Unemployment remains higher than the national average, and poverty is on the rise.

In fairness to the rest of the nation, the empowerment-zone legislation set seemingly objective criteria that allowed all cities to compete. Even so, that Los Angeles was knocked out of the box is nothing less than a mistake.

There is plenty of blame to go around for why the city lost the prize. An application pathetically weak on detail and lacking in parallel public and private commitments evidently could not compare to the specific visions of the victorious cities. For example, both New York City and New York state promised to match Washington’s money. Chicago banks put together a $2-billion package of loans to leverage the federal investment. Baltimore pledged eight dollars for every dollar allocated under an empowerment zone.

Even so, in Los Angeles, commitments from many sectors may not have been forthcoming because the state and city are scraping by and many corporations still have not recovered from the recession, the riots, the earthquake and other blows to the bottom line.

The Clinton Administration, keenly aware of California’s 54 electoral votes, is trying to put the best face on this bad situation. So is the embarrassed Riordan Administration, though the mayor was so angry Wednesday he refused to participate in a conference call the President hosted. The truth is, the city should not have been shunted aside, flawed application or not.

President Clinton is expected to ask Congress to approve an empowerment zone just for Los Angeles, and we hope the GOP majority in Congress will support the request. California’s gold mine of electoral votes may provide a second chance for an L.A. empowerment zone. As this region struggles to rebound, nothing less from Washington will suffice. On its merits, Los Angeles deserves the help.