The three people chosen Wednesday by Gov. Jerry Brown to dismantle Los Angeles' sprawling, half-century-old redevelopment agency are not strangers to the real estate business or city politics.
One is an attorney and City Hall lobbyist, another a consultant who once worked closely with the redevelopment agency, and the chair of the new panel led a firm that was Los Angeles' largest owner of upscale downtown office space.
The City Council jettisoned its redevelopment agency two weeks ago. The three-person panel is required by state law because L.A. Mayor Antonio Villaraigosa and the council opted not to step in and assume the risk of unwinding the agency's hundreds of millions of dollars in assets, complex land deals, employee obligations and development loans.
Brown led a successful push to abolish redevelopment agencies statewide to free up money for the state budget. About 400 such agencies will be closed, shifting billions in tax revenue to state, city and county agencies.
Known as designated local authorities, the new panels are responsible for disposing of agencies' assets and paying existing bond debt. A seven-member statewide board will oversee the new local authorities.
Among the appointees to L.A.'s panel is Timothy McOsker, who lives in San Pedro and was former Mayor James K. Hahn's chief of staff. McOsker is an attorney for the firm Mayer Brown and works on issues involving land use and entitlements. He is also a registered City Hall lobbyist and officer with the business-centric Central City Assn., which closely tracks downtown redevelopment activities.
Developer-investor Nelson Rising of La Cañada Flintridge, who was once chairman of the board of the Federal Reserve Bank of San Francisco, was picked to chair the new authority. Until late 2010, he served as chief executive of MPG Office Trust, owner of downtown's US Bank Tower, the tallest building in the West, and other office buildings. Rising is the chairman of Rising Realty Partners.
Mee Semcken of San Marino, who was the City Council liaison for the city's Community Redevelopment Agency a decade ago, also was appointed. She is the president of Lee Consulting Group LLC.
On Wednesday, some questioned whether adequate measures would be in place to address potential conflicts of interest involving board members. "There's an urgent need to clarify the rules of the road, or there's going to be the potential for unknown problems," said Madeline Janis, who previously served as one of Villaraigosa's seven appointees to the redevelopment agency's board.
"What rules do people have to go by?" Janis asked. "And that's really urgent given that we're talking about hundreds of millions, if not more, worth of land and public money." Wednesday evening the governor's office released guidelines intended to address ethics and other issues, noting normal state conflict-of-interest restrictions apply.
Robert Stern, former president of the watchdog Center for Governmental Studies, said the new appointees will probably have to file statements of economic interest to ensure they don't act on anything that could benefit them or their clients financially.
"My guess is that they do have to file these statements and they are subject to the state law. And if they're not, it sounds like they should be," Stern said.
McOsker said he does not have any redevelopment matters pending and will be careful in the new, unpaid position. He said he would recuse himself if necessary from decisions and consult with government attorneys if potential conflict issues arise.
Untangling the redevelopment agency's complex business dealings "is an incredibly difficult problem," McOsker said. "I just thought, if I don't do it, who will?"
Brown also appointed similar authorities in Merced, Stanislaus and Ventura counties.