Hunt Is On for Fix-Up Money

An effort to spruce up Westwood Village to lure more shoppers is grinding to a halt, and village merchants are asking what happened to hundreds of thousands of dollars that were supposed to help fund the effort.

A private audit is underway to solve the mystery of the missing money. It may expose whether the money -- which was thought to have been collected by the city from property owners -- was stolen, never received or lost in a bookkeeping mishap.

The audit’s conclusions may not only influence Westwood’s future but also serve as a wake-up call to fans of a fast-spreading trend in the area of economic development. The nationwide trend is to create “business improvement districts” -- entities that are designed to supplement, but not replace, city services.

Westwood was home to one of 32 business improvement districts in Los Angeles, nearly double the 17 that the city had in 1999.

Merchants or property owners in a designated area typically are assessed fees to fund the districts. The idea is that shoppers will flock to clean, safe streets that are free of graffiti and lined with freshly trimmed trees.

The business improvement district in Westwood administered a parking validation program and funded a community service center, in addition to bolstering maintenance services. Like others in the city, the district was governed by an appointed board of directors and chartered by the city.

Problems with the Westwood district surfaced in September, when Los Angeles County prosecutors concluded that the Westwood Village Community Alliance, the nonprofit corporation that administers the district, had violated the Brown Act, the state’s open-meeting law.

Los Angeles City Councilman Jack Weiss also joined the criticism, concluding after a monthlong analysis that the improvement district was a “flawed institution” and announcing that he had decided against its renewal. Consequently, property owners can no longer be assessed fees.

Next came word from City Clerk J. Michael Carey that the district had just $40,000 left in its account, rather than the $600,000 or more that some board members had assumed.

That revelation prompted the alliance board to call for a private audit to cover a three-year period dating to 1999 -- the year annual audits of the district inexplicably ceased. The audit’s outcome is not due for several weeks.

The lag time has given rise to a combination of speculation, finger-pointing and soul-searching in Westwood.

“What we’re trying to find out is if the city has paid us all the money,” said Frank Ponder, the board’s president. “We’re not sure if they’ve collected all the money they’re supposed to.”

Karen Kalfayan, chief management analyst for the city clerk’s office, suggested that the fiscal confusion might have been caused by a miscalculation of how much money the district would raise.

A district management plan drawn up in 2000 predicted that the program would collect about $1 million a year, Kalfayan said, but during the last year, assessment fees totaled only $844,000. The difference, she said, could explain why the district’s account holds less money than board members had assumed.

Baffled board members wonder whether the funds got lost in a fiscal quagmire that is waiting to be unearthed by an accountant.

Bob Walsh, the business improvement district’s executive director, resigned in October and could not be reached for comment.

Although some merchants will continue certain district functions voluntarily, other services have been eliminated or diminished. A community service center on Broxton Avenue has closed, for example. The UC Police Department is owed at least $15,000 for three community service officers who helped staff the office, said Nancy Greenstein, a department spokeswoman.

The city clerk’s office is working with several other creditors, including a maintenance company that has not been paid since March.

A separate assessment that predates the district and totals about $200,000 annually is available for the next five years to bolster trash pickups, tree trimming and sidewalk cleaning.

That may not be enough to appease eagle-eyed merchants. Some have noticed more gum, cigarette butts and newspapers littering village gutters and sidewalks.

“It seems to me there’s a little more junk on the streets,” said Jeff Abell of Sarah Leonard Fine Jewelers.

Weiss said he and several local leaders are discussing creation of an organization that won’t repeat the mistakes of its predecessor. The focus, he said, should be on keeping Westwood clean.

“In ‘Field of Dreams,’ they said, ‘If you build it, they will come,’ ” Weiss said. “My feeling with Westwood is, if you maintain it properly, they will come.”

Others sense that bigger culprits are keeping crowds at bay. A village once known for a melange of one-of-a kind shops and glittering Hollywood movie premieres has lost some of its luster over the years.

And then there’s the “P” word. “The economic engine is here in Westwood. The problem becomes, it’s too inconvenient,” said Jay Handal, president of the West L.A. Chamber of Commerce. “That gets back to the parking, the parking, the parking.”

Handal was one of several dozen people who attended a Nov. 13 town hall meeting to discuss Westwood’s future. Participants repeatedly cited a dearth of inexpensive, convenient parking as a key problem that city officials must do more to address.

“I’m somewhat of a heretic here,” Weiss said in an interview. “I believe there is parking in Westwood.... Sure, we can do better, but I don’t want people to be under the misimpression that they can’t come to Westwood to park and shop because they can.”

Whether Westwood merchants or property owners will choose to create a new improvement district to tackle the parking issue and other drawbacks is unclear.

If a “trauma” hits a business improvement district, “it’s often several years before there’s enough collective will to take another shot at it,” said Bradley Segal, a Denver-based consultant for several California business improvement districts.

But creating another district also will depend on what happened to the missing money.

“I’m hoping that the money is there and that nobody has kept track of it in a proper way,” said Abell, who was a district board member. “If money was spent on things not authorized by the board, I don’t know where this will go.”