Secession Group Praises Report

Advocates of Hollywood secession from Los Angeles released a study Monday saying their proposed city would generate more than enough taxes to sustain itself, but prospects for a referendum on cityhood remained uncertain.

The report by the Hollywood VOTE secession group found the proposed city of 265,000 people would produce $146 million in revenue each year and run annual surpluses as high as $39 million.

“I’m on cloud nine,” said nightclub owner Gene La Pietra, the founder of Hollywood VOTE. “I couldn’t be more delighted.”

But to put Hollywood independence on the ballot, the autonomous Local Agency Formation Commission must affirm the positive fiscal outlook--and LAFCO has said it lacks the money to study the proposal.

Hollywood VOTE released its report just as Los Angeles officials were raising new questions about secession proposals for the San Fernando Valley and for the harbor area. LAFCO is studying those proposals and plans to decide in March whether to put them before voters.

In a report released Monday, City Administrative Officer William T. Fujioka urged Mayor James K. Hahn and the City Council to negotiate with Valley and harbor secession groups on how to shape prospective ballot measures.

One of Fujioka’s top concerns was that a shrunken Los Angeles would get stuck with debt obligations of the new Valley and harbor cities. He said the Valley and harbor cities should be required to replace their shares of the city’s $2.4 billion in outstanding debt with their own debt--$806 million for the Valley and $74 million for the harbor area..

“It’s like you’ve got a Visa card in both names,” said Ellen Sandt, an analyst in Fujioka’s office. “We’re saying get a Visa card in your own name and pay it off yourself.”

Fujioka also said Valley and harbor cities should remain responsible for repaying their shares of debt on projects downtown like the Convention Center and Central Library renovations. The Valley, for example, would have to repay $167 million of the $504 million in Convention Center debt.

Richard Close, chairman of the Valley VOTE secession group, said Los Angeles officials are trying “to shift their liabilities unfairly” to Valley and harbor area residents.

“This report shows that the city is dedicated to making this process as expensive and contentious as it possibly can,” he said.

Valley and harbor secessionists hope the Hollywood proposal will go on the ballot at the same time as their own to broaden support for breaking apart Los Angeles.