Los Angeles shopping mall developer Rick Caruso questioned the intellectual firepower of City Council leaders Thursday in a blistering speech that could be his prelude to a run for mayor. He called the city’s 13.4% unemployment rate “embarrassing” and argued that firms have fled town because of onerous regulations and taxes.
The one-time head of the Los Angeles Police Commission has long been known for his brio and bluntness, and he has been one of the most vociferous critics of Los Angeles Mayor Antonio Villaraigosa, who he considered challenging for reelection in 2009 and who will be forced out by term limits in 2013.
But Caruso widened his range of targets to include other potential mayoral contenders and city officials in appearing at a luncheon hosted by the group Town Hall Los Angeles.
Drawing on his own experience in building the Grove shopping center in the Fairfax district and a new luxury apartment project on Burton Way at La Cienega Boulevard in Beverly Grove, Caruso described the city’s processes as a “bureaucratic nightmare” and City Hall as “a roadblock keeping Los Angeles from its potential.”
He added that those kind of frustrations recently led his company, Caruso Affiliated, to drop plans to compete for a design and development project at two Los Angeles International Airport terminals, and went on to say that when visitors roll into aging LAX, they “could be landing in any Third World country you want to pick on the face of the Earth.”
In what could be seen as a dig at other potential mayoral candidates — including council President Eric Garcetti, City Controller Wendy Greuel and Councilwoman Jan Perry — Caruso said city leaders haven’t been able to grasp the scope of the city’s problems, much less address them.
“They look instead to the next election, the next fundraiser, the next ribbon-cutting or in many cases tickets to the next sporting event,” he said, making a reference to Villaraigosa’s recent reprimand from ethics officials for accepting free ticket to L.A. events.
At one point when discussing the proposal for a new football stadium downtown, Caruso charged that some council members “have a tough time spelling the word football.”
“When you see families moving to Calabasas for schools and commuting to El Segundo for jobs, you see the scope of L.A.'s problem,” Caruso said.
The developer said the city must “reduce and eventually phase out” its gross receipts tax, which he called “regressive,” “anti-business” and a “job-killing machine.”
Caruso did not offer specifics, however, on how to fill the hole that would be created in the city budget at a time when Los Angeles is in the midst of a financial crisis.
In the 2011-12 fiscal year, gross business tax receipts are projected to be about $439 million of the city’s $4.37-billion general fund budget. That revenue is nearly equivalent to the annual cost of running the city Fire Department.
Caruso has been coy about his future plans, but he signaled that he’s surveyed the competition by singling out another contender, former First Deputy Mayor Austin Beutner, who headed job creation and business recruitment efforts for Villaraigosa over the last 15 months.
Caruso dismissed the “limited success” of the city’s “job czars” and “business SWAT teams.”
Sean Clegg, a consultant to Beutner, a former investment banker, shot back later in the day that despite Caruso’s criticisms he had contributed to many of the city’s top leaders at a time when his projects were moving through the city’s process.
“A campaign for mayor is no day at the mall, and Angelenos will see past the phony streetscape,” Clegg said. He called Caruso a “pay-to-play mall developer who gave money to half the City Council he’s attacking and who just went after the biggest city contract.”
Caruso, who is known as an intensively hands-on manager of his company, has taken several steps recently that have heightened the speculation that he will enter the race.
In February, he elevated his executive vice president of operations, Paul Kurzawa, to chief operating officer of Caruso Affiliated, freeing him up from some of his daily management of the company.
Caruso said he was intrigued by the mayor’s job because he was frustrated by changes to the city: “It’s like we’re running in the mud.”
“I want to come in, get a job done and go back to my private life,” he told reporters before the speech. But moments later, he insisted he was still making up his mind on a run: “I’m not telling you my time frame,” he said. “Good try though.”