Whole Lotta Nothing In L.A.

How the Community Redevelopment Agency is turning the City of the Angels back into a desert.


How's this for bragging rights?

Big city real estate developers like nothing better than to point to a completed property, flush with tenants and thriving businesses, to justify the hardship, labor, and money that go into a major building project.

Yet here's how the Community Redevelopment Agency of Los Angeles, a 62-year-old agency that controls billions of dollars worth of L.A. property, describes its most important achievement on a development area valued at $111 million:

"CRA/LA successfully defended a legal challenge to our adoption of the Western Slauson Recovery Redevelopment Project Area."

Not impressed? Then check out this endzone dance in celebration of CRA achievement on a plot of land valued at more than $50 million:

"A master plan was completed to guide the redevelopment of the area's industrial core, bounded by Crenshaw Boulevard, Florence Avenue, Hyde Park Boulevard, and West Boulevard."

OK, but what about the CRA's yeoman work on the $279 million Marlton Square development in the city's Crenshaw district?

"After construction started on the senior housing units, the developer's legal and financial problems brought work to a standstill in early 2008. However, CRA/LA is working to resolve these issues."

These are just the projects for which the CRA even claims some achievement. In many cases the agency wisely says nothing at all.

The Community Redevelopment Agency describes its mission in terms that are as clear as the Salton Sea: "We make strategic investments to create economic opportunity and improve the quality of life for the people who live and work in our neighborhoods." But the agency is being modest. Its real goal, the one in which it has been spectacularly successful, is to turn Los Angeles back into a desert.

This is clear enough from the CRA's track record. You could not devise a better machine for creating and maintaining urban blight if you tried. The agency's board of directors—including such luminaries as the all-purpose activist and "living wage" crusader Madeline Janis * —is a nearly perfect collection of people who have never had to balance a checkbook.

The CRA's affinity for corrupt reverends, dubious community activists, and outright crooks is legendary: That developer with "legal and financial problems" in the Marlton Square debacle is the serial check bouncer and tax cheat Christopher Hammond, whose only visible skill is an ability to game the local political class. The agency's partner in the two-decade-old Slauson Central Retail Center project is the highly questionable community group Concerned Citizens of South Central Los Angeles, which has a long history of taking public money for projects that never get built.

Worst of all is the CRA's cockamamie funding mechanism, which relies on incremental property tax credits and thus ensures that it will be least effective in those areas it was set up to assist—the ones with the lowest land values. The agency's annual report [pdf] highlights successes in developments at Hollywood Blvd. and Vine Street (where Capital Records is), as well as Hollywood and Highland (where the Oscars ceremony is held). But take a ride down to the corner of Broadway and Manchester—a truly distressed area that remains undeveloped 18 years after the 1992 riots (or "civil unrest" in CRA language). There, we find that, "Redevelopment activities to date have been handicapped by the lack of significant tax increment funds."

Yesterday, L.A.'s city council approved—for the third time—an effort, girded by $7 million in public funds, to get a shopping mall built at the CRA's Slauson-Central project. If the past is any guide, the development will never be built, but the aftermath of the vote was interesting. L.A. Times reporter Patrick McDonnell provided a generally balanced view of the project, only to get the following rebuke from Concerned Citizens executive director Noreen McClendon, on a local list serve:

We were successful in getting this project approved for the third time today. The attempts to malign the reputation of Concerned Citizens of South Central Los Angeles did not work. The Los Angeles Times NEVER tells the whole story. When they discuss the court finding CCSCLA in breach of contract, what they don't say is that the City waited until there was approximately $5 million in eminent domain funds on the line to CLAIM a breach… The opponents of this project have paid the South Central Farmers, Jackie Sims formerly of the Watts Neighborhood Council, the Parents of Watts (Sweet Alice's folks) to come oppose our project. Not because we have done anything wrong, but simply to get paid. It is a shame that our folks are so hungry that they will take as little as $50 each to oppose a project in another neighborhood. Not to mention opposing a group of color working on behalf of low and moderate income people of color.

CCSCLA has been working diligently for 20 years to get this shopping center built. 

The only logical response to this is, "Twenty years is long enough. Time to let somebody else try." But that's a blink of an eye in CRA time. It's been nearly two decades since South L.A.'s civil unrest, or if you prefer, "economic referendum." Following the riot, the Community Redevelopment Agency, with enthusiastic support from local pols, was given a shockingly broad mandate to seize, assemble and develop land for development of high-end retail, housing, and restaurants. The CRA new controls nearly a billion dollars worth of real estate in South L.A., and almost none of it has been developed. 

They say failure is an orphan, but they're wrong. Everything the CRA touches generates a new class of illegitimate parents, as participants blame each other for the debacle. McClendon's complaint above is characteristic, but there are other hobgoblins. Eli Sasson, a developer who spent his own money to assemble several blocks of land for a development at Vermont Ave. and Manchester Ave., was denounced by Janis and other CRA officials in preparation for an eminent domain proceeding against him in 2008. Two years later, the status of the Vermont/Manchester project is cloudy, but the status of the project area is quite clear: Like almost all CRA areas, it is a vacant lot.

No less a figure than legendary Lakers point guard Magic Johnson served as a CRA scapegoat in 1999, when the itinerant local politician Mark Ridley-Thomas (then a city councilman, now a county supervisor) dumped him from the Marlton Square project in favor of the shady Chris Hammond. Then again, Magic is at a disadvantage in this game: He actually gets things built.

But the CRA, the Moriarty of public organizations, is the culprit at the scene of every crime. A bloated, self-perpetuating organization that turns poverty into penury; that could solve the budget deficit and revitalize the economy just by selling off its holdings and putting itself out of business; that elevates process over progress and political speech over any actual accomplishment; and that occasionally grabs the credit for successes private operators achieved in spite of the agency's interference: The CRA is more than just an L.A. problem. It's the perfect government agency.

Tim Cavanaugh is a senior editor at Reason magazine.

* An earlier version of this article incorrectly referred to CRA Chairman Bruce D. Ackerman. Ackerman died August 26.