Outsider Is Selected to Head CRA : Government: Board hopes Sacramento’s redevelopment chief can give troubled L.A. agency new vigor. Council approval is expected next week.

Officials of the once-mighty Los Angeles Community Redevelopment Agency on Thursday looked to an experienced outsider to lift the now-drifting and cash-strapped agency out of its doldrums.

John E. Molloy, executive director of the Sacramento Housing and Redevelopment Agency, was the unanimous choice among four finalists, CRA board Chairman Dan Garcia said in announcing the selection after the board’s closed-door session on the appointment.

Molloy will earn $155,000 a year, along with a $20,000 moving allowance, under the terms of a four-year contract that is being drawn up, CRA officials said. They added that they will not disclose other details of the contract until it goes to the City Council, which has the final say in the hiring. Council approval is expected next week, and Molloy plans to begin work in September, officials said.

The appointment of the 48-year-old Molloy, a 20-year veteran of leadership roles in municipal planning, redevelopment, finance and housing agencies, comes as the CRA struggles to redefine its mission. The agency that for years presided over the building of a rich and glittering Downtown has gradually shifted its focus to building affordable housing and trying to revitalize neighborhoods devastated by the riots in 1992 and the Northridge earthquake in 1994.

It has been without a full-time administrator for nearly a year. The City Council, which has seized more authority over the CRA board since the agency’s controversial buyout of its administrator’s contract in 1991, is debating whether to take over the board altogether. The mayor’s office, which appoints CRA board members, is floating a separate proposal to reorganize the agency. Finally, an outside management audit this year found the agency to be top-heavy, lacking a clear mission, burdened by a cumbersome decision-making process and suffering from a complicated and declining financial situation.

Molloy has a “Herculean job cut out for him,” Garcia said.

“We have a made a great selection,” the board chairman said, then added: “I am looking forward to the new leadership--we can certainly use it!”

Just one example of the kind of headaches Molloy will inherit surfaced on the very day the panel made its selection announcement. Board members were informed that the CRA was having trouble selling a $15-million bond offering involving the agency’s highest-profile project: Bunker Hill in Downtown. In the last three years, 90% of Bunker Hill revenues have gone to pay for housing, social services or economic revitalization in other parts of the city, officials said.

Because of the recession-induced lowering of Bunker Hill property tax assessments, Standard & Poor’s reduced the agency’s credit rating to BBB-, just below “investment grade,” according to agency finance chief Peirre Lorenger. As a result, no one offered to buy the bonds unless the bonds paid a hefty 10% interest--a rate unacceptable to the CRA. Lorenger said the agency can wait and try again in September, when he expects a more favorable prognosis, or find other ways to borrow money.

“I’m disappointed, but it’s not the end of the world. We have other ways of getting the money,” Lorenger said.

But there are bigger issues threatening the CRA. A series of lawsuits by its old nemesis, retired Councilman Ernani Bernardi, has stalled agency efforts to make further improvements in the Central Business District. Bernardi wants to stop the agency, which finances its projects through the increased property taxes generated by its developments, from collecting its share of taxes so the funds can go to the city, county, schools and other local government agencies.

Critics leery of the 1960s- and 1970s-style of redevelopment--in which entire neighborhoods deemed blighted were leveled and replaced with sleek commercial buildings and expensive condos--are fighting establishment of projects in other areas. The formation of a quake-recovery CRA project in Sherman Oaks became a key issue in this spring’s City Council race to represent the area.

Molloy will find these and other challenges as he takes the reins of the nation’s largest redevelopment agency, with 23 projects and three neighborhood revitalization programs throughout the city.

The search for a new administrator was steered by a special committee made up of Garcia, Mayor Richard Riordan and Councilmen Mike Hernandez and Mark Ridley-Thomas. They narrowed the field to eight applicants, interviewed them and forwarded four finalists’ names to the CRA board.

Garcia, pointing out that the agency faces a 13% cut in its staff while taking on more economic development activity, said Molloy is well-suited for the job.

As head of the Sacramento agency for the past four years, Molloy, who holds a doctorate in public administration from USC, has forged an economic development and affordable housing agenda and guided historic preservation and neighborhood projects. He also steered major projects for Downtown revitalization and developed a master plan for the river city’s waterfront.

A Vietnam combat veteran, the former Air Force officer is a colonel in the California Air Guard. He could not be reached for comment Thursday.

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Profile:

John E. Molloy

A 20-year veteran of housing, redevelopment and planning agencies, Molloy has been chosen administrator of the troubled Los Angeles Community Redevelopment Agency.

* Born: Dec. 9, 1946

* Residence: Citrus Heights, a suburb of Sacramento.

* Education: Doctorate in public administration, USC; master’s degrees in urban and regional planning, USC, and public administration, Golden Gate University; bachelor’s degree in zoology and chemistry, University of Connecticut.

* Career highlights: Chief executive of the Sacramento Housing and Redevelopment Agency, overseeing downtown renovation, historic preservation projects, community services and facilities development, and creation of a master plan for the river city’s waterfront; chairman of the Sacramento Economic Development Cabinet; managerial posts in the Sacramento County Administration and Finance Agency and in the county Planning Department; Air Force officer and Vietnam combat veteran.

* Interests: Skiing, hiking; colonel in the California Air National Guard.

* Family: Married to Linda Molloy, a substitute teacher; two sons, ages 20 and 22