Hahn’s First Order of Business: Tax Relief

What will Los Angeles Mayor-elect James K. Hahn mean for business? It’s too soon to tell, but from what Hahn and his advisors say, he will be a mayor who will push economic development--with breaks for small companies and an emphasis on boosting business in poor neighborhoods.

Immediately, he will go for tax relief and cutting red tape on permits and licenses for business, according to the Hahn camp.

“He has come out for a two- year exemption from tax for small business start-ups and he wants to simplify the business tax system,” says George Kieffer, an attorney at Manatt, Phelps & Phillips, a Westside law firm, who served as policy chairman in Hahn’s campaign.

During the race, Hahn called for adopting the tax reform plan recommended by Mayor Richard Riordan’s special commission.

Hahn may be able to get the tax reforms through, says Kieffer, because he “will be able to work more closely with the City Council.”

Working within the system is likely to be a recurring theme for Hahn, who takes office July 1.

Hahn, 50, is a career municipal official himself, with 24 years in government--including his current job as Los Angeles city attorney. Also, Hahn’s campaign was backed by the service unions that represent workers in the city’s agencies and departments.

So Hahn is a pretty sure bet to work closely with the City Council--instead of warring with them, as the Riordan administration has often done.

Hahn is the son of the late Kenneth Hahn, a Los Angeles County supervisor revered for expanding public services to poor areas of the city. That tradition undoubtedly will find renewal in James Hahn’s administration, experts say.

Hahn will move immediately to reduce red tape in the business permitting process, a traditional thorn for small firms, says Bill Wardlaw, an influential lawyer who chaired Hahn’s campaign and also ran Riordan’s two mayoral campaigns.

“If your permit is not acted on within a [set assigned time] you receive a permit free of charge,” Hahn has promised.

“Hahn will work to bring new business to the city,” Wardlaw says. What kind of new business? The mayor-elect named no specific business in his campaign literature, but he has said that the Los Angeles region, with its vast economy and abundant academic and scientific resources, ought to be a magnet for advanced fields such as biotechnology, information sciences and other new industries.

Hahn will have new authority, granted by the City Charter, to hire and dismiss heads of city agencies. That and the fact that he will administer a $4-billion city budget will give him power relative to the City Council and to smaller communities among Los Angeles County’s 88 cities and nearly 70 cities in neighboring counties.

During his campaign, Hahn gathered teams of advisors to formulate economic policies for his administration. Dan Garcia, former commissioner of the Los Angeles Airport Authority, was an influential member of those teams and will continue as an advisor to the Hahn administration, sources say.

Ken Lombard, president of Magic Johnson theaters and a director of the Los Angeles Department of Water & Power is reported to be another close advisor.

David Fleming, head of the San Fernando Valley Industry and Commerce Assn., is an important advisor on that secession-prone region of Los Angeles.

Alan Arkatov, the entrepreneur founder of E-learning, an online educational firm recently sold to Sylvan Learning Systems, is an advisor to Hahn who specializes in ideas for education. And Mary Leslie, onetime deputy mayor to Riordan, is also numbered among advisors to Hahn.

And Janice Hahn, the mayor-elect’s sister who just won election to represent the Harbor area on the Los Angeles City Council, will certainly have influence.

Hahn reaches out to many people for advice, his associates say. “He understands the needs of today’s city, and knows that we need to focus on education, transportation and public safety or no business will want to come here and no executives will want to live here,” Kieffer says.

As mayor, Hahn will work to set up a separate agency for school construction to get work moving on the city’s pressing need to build 100 or so schools.

On transportation, Hahn will shift the emphasis of the Metropolitan Transportation Authority from an almost single-minded focus on mass transit to efforts to repair and upgrade streets and traffic lanes for cars and trucks.

At the same time, development in poor neighborhoods is sure to get a boost. Hahn was born in South Central Los Angeles and has deep ties to that community, and backing from its churches.

Wednesday, officials of those churches looked forward to a Hahn administration. “We are encouraged by Mayor Hahn’s support of faith-based economic development,” says the Rev. Mark Whitlock of First African Methodist Episcopal Church.

Whitlock heads Fame Renaissance, the economic development arm of the First A.M.E. which, along with the West Angeles Church of God, is a force for development in South Los Angeles’ poor neighborhoods.

Those are the neighborhoods to which Kenneth Hahn brought city services at a time when their mostly African American populations were underserved. Today the same communities, now mostly Latino, are underserved again, but about to receive new attention from a new Hahn administration.

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James Flanigan can be reached at jim.flanigan@latimes.com.