Oversight Left Staples Tract Tax-Free for 5 Years

For the past five years, the Los Angeles County assessor’s office has forgotten to collect millions of dollars in property tax on 26 acres across from Staples Center, where a billion-dollar hotel and entertainment complex is slated for development.

The oversight began in 1999, when the deed for the property was lost as it was being transferred from the Community Redevelopment Agency to the Anschutz Entertainment Group, which owns Staples Center and is developing the hotel complex.

Neither the assessor’s office nor Anschutz caught the mistake until it was brought to their attention by the redevelopment agency this month.

“We either did not get or did not process the deed,” county Assessor Rick Auerbach said. “Whatever reason it happened, we should have caught it.”

The assessor’s office handles 550,000 deeds each year, and it is “very, very seldom” that one is lost, Auerbach said. In 1999, the office relied on a paper-based system that has since been replaced by the electronic transfer of deeds, making oversights even less likely, he said.

The exact amount of property taxes owed is not known because the land has not been assessed recently, said Michael Roth, a spokesman for Anschutz. “Any bill that is owed we will pay,” Roth said.

Back taxes probably total several million dollars, Auerbach said, because the redevelopment agency bought the land for $68 million in 1999 before transferring it to Anschutz, who will repay $58 million over 20 years through admissions taxes on tickets and parking income.