Category Archives: Hollywood Chamber

Business, California, City of Los Angeles, Community, Economic Development, Employment, Hollywood, Hollywood Chamber, Jobs, Minimum Wage

The City Needs to Listen to Small Businesses

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Over the past month, members of the Hollywood Chamber of Commerce have been pounding the pavement at City Hall, making our case as to why the City needs to give a break to small businesses with the proposed minimum wage increase.

The current proposal would raise the minimum wage from the current $9 to $13.25 an hour by 2017.  This would be achieved through $1.25 increases per year. Some councilmembers have even suggested an additional increase to $15.25 by 2019.

What has impressed me as we have made the rounds at City Hall is the compelling information that our small businesses have shared with City officials.  Let me share some of the insights that I have gained.

When a City raises the costs of doing business, it forces the business to compensate by reducing costs elsewhere.  That means businesses will not expand, fewer jobs will be available, employees’ hours will be cut, summer jobs for students will decrease, and businesses will make do with fewer employees.  That is hardly a recipe for job creation in the nation’s second largest city – which still has fewer jobs today than it did 25 years ago.

One of the industries that will be hardest hit by the minimum wage hike is restaurants.  The L.A. Times recently quoted data that the net profit margin for restaurants averages 3 percent, compared with a nearly 6.3 percent profit margin for all private industries across the country.  … which means that restaurants have a lesser ability to absorb these mandated increases.

Our restaurateurs say that payroll represents between 40 and 60 percent of their overall costs.  They scoff at the City-commissioned Berkeley study’s claim that they will only have to raise their prices by a cumulative 4.1 percent by 2017 in order to cover the minimum wage hike.

One restaurateur said that ancillary costs tied to wages such as Social Security, unemployment insurance and workers’ compensation premiums would add roughly 30 percent to the cost of the 47 percent increase proposed by the City. In addition, they would have to pay increased costs for their restaurant supplies as other vendors within the City raise their prices to also compensate for the wage increase.  He estimated that prices would need to be raised by up to 35 percent to fully recover the added payroll costs.  However, restaurants’ customers are highly price sensitive, which would limit a restaurant’s ability to raise prices significantly.

One retailer explained that the added payroll costs may push them over the brink. They are unable to hike their prices to compensate for the increased costs of the wage mandate, because of internet competition.  If they raise prices, they will lose customers.

A nonprofit organization detailed how they compete for statewide grants.  As they factor in the costs of the hike in the minimum wage, it will place them at a competitive disadvantage with nonprofits from other areas of the state and likely cause them to lose grants and jobs.  They anticipate having to cut their student jobs and hours by 40 percent.

The Hollywood Chamber of Commerce recognizes the need for an increase in the minimum wage and we have offered qualified support if the City takes steps to protect its small businesses.  Of course, the best solution would be for the City to offer an exemption for small businesses below an established threshold of employees. This would be the right step to preserve jobs and small businesses.

If that is not achievable, then the City of Seattle offers a model where they increased the minimum wage for small businesses at the reduced level of 50 cents annually.  An increase of that order, as compared to the $1.25 a year increase now proposed, would be easier for small businesses to absorb.

The City’s justification for raising the wage is to get people out of poverty.  What they have missed in all of this is that the businesses they would hurt the most are the ones that create the most new jobs.  These small businesses hire unskilled and untrained workers.  They train these employees and give them an opportunity to join the workforce and to move up the ladder as they acquire skills.  The proposed wage increase could hurt the very people the City wishes to assist.

Our message to the City Council is not to “kill the goose that lays the golden egg.”  Do the right thing and take steps to protect the small businesses that do so much for our economy.

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Leron Gubler has been serving as the President and CEO of the Hollywood Chamber of Commerce for the past 22 years. His tenure since 1992 continues to oversee the great comeback story of Hollywood.

City of Los Angeles, Economic Development, Employment, Hollywood, Hollywood Chamber, Jobs

This Would be a Good Year for City Business Tax Reform

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Last week, Mayor Eric Garcetti announced that Yahoo was moving into the City of Los Angeles.  The firm will be relocating from Santa Monica to Playa Vista and will bring 400 jobs.  This is of course very good news for the City.

Of particular interest to me is what enticed Yahoo to make the move to the City of Angels.  The Mayor listed the City’s special incentives, including a three-year business tax waiver for businesses relocating from outside the city as well as L.A.’s special tax incentives for Internet companies.

The fact is taxes are a huge issue when it comes to enticing businesses to locate within a city. Taxes are also a significant issue when it comes to retaining businesses.  Only four years ago, Hollywood lost Legal Zoom and 300 high-paying jobs to Glendale when the City insisted on more than quadrupling that firm’s business taxes.

Years ago, when I worked in San Pedro, we fought a similar battle to retain Logicon, which was being enticed by Long Beach because of the differential in taxes.  It was only when the City found a way to reduce the gross receipts tax, that we were able to retain what was then an important aerospace company.

Last year, UCLA reported that L.A. had one of the worst job creation records of any major city in the nation.  I am convinced that the gross receipts tax is the reason why we lag so far behind.

And yet, it is very difficult to get meaningful action to alter this job-killing tax – primarily because the City garners 10 percent of its budget, about $440-million annually from this tax.  The City Council, facing difficult budget forecasts, is understandably reluctant to give up this source of revenue.

While we appreciate the fact that they did approve a small decrease in the tax last year, it was so small as to be almost meaningless if they really wanted to change the paradigm (16 percent decrease in the highest rate spread over three years).

This city really needs jobs.  Its resident need jobs.  And the city needs all that new companies bring to a city by way of civic engagement and the other contributions that they make.  Recruiting new businesses to relocate to Los Angeles and actively retaining our diverse and vibrant business community will require a new approach to our antiquated business tax structure.

The Hollywood Chamber of Commerce believes that the best tactic to bring jobs to Los Angeles would be to completely do away with the Gross Receipts Tax.  Numerous suggestions have been made on how to phase out the gross receipts tax.  Some have suggested that we replace it with something else – such as a net receipts tax.  One thing is for sure … if you really want to attract jobs, the city cannot replace an onerous tax with another onerous tax.  A great deal of thought needs to be put into whatever is done, so that we are competitive with our neighboring cities.

Wouldn’t it be nice if 2015 were the year when the City Council and Mayor finally tackle this problem and find a real solution?  What a gift that would be to our citizens, to take meaningful action which will help to generate countless new jobs within our city.

Then perhaps there would be even more stories about firms like Yahoo moving to Los Angeles.

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Leron Gubler has been serving as the President and CEO of the Hollywood Chamber of Commerce for the past 22 years. His tenure since 1992 continues to oversee the great comeback story of Hollywood.

Economic Development, Hollywood, Hollywood Chamber

It Was A Good Year For Hollywood

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As the year 2014 draws to a close, I thought I would write one final column to end the year. Based on the scorecard that I keep, it was a very good year for Hollywood on the jobs front. The momentum for Hollywood continues to build.

Over the past several years, we have averaged three or four significant projects breaking ground on an annual basis. In 2014, by comparison, we had eight. They included: JH Snyder’s Hollywood 959 project with 244,000-sq.ft. of office space in the Media District, Kilroy Realty’s 700,000-sq.ft. Columbia Square project, Lennar’s 1411 N. Highland project with 76 rental units, Hollywood International Regional Center’s 182-room Dream Hotel, Hudson Pacific’s 315,000-sq.ft. Icon at Sunset-Bronson Studios, the 112-room Hampton Inn on Vine by Holivine Investments, Wood Partner’s Alta 5550 with 280-apartments, and finally JH Snyder’s 1601 Vine Street with 100,000-sq.ft. of office space.

This investment is breathing new life into Hollywood. Currently, we have about $1-billion under construction. Almost all of these projects are replacing parking lots or old dilapidated commercial buildings – not residential properties. Each of these projects will add vitality to the street and add to the safety of the neighborhood.

We also had two great leases announced in 2014 – both for Columbia Square. Neuehouse, out of New York, will occupy 93,000-sq.ft., while Viacom has leased 180,000-sq.ft. to house its cable networks, including MTV, Comedy Central, BET, and Spike TV.

With a million square feet of office space under construction and the Westside filling up, Hollywood is well positioned to benefit. We anticipate that Neuehouse and Viacom are the vanguard of new firms who will be coming to Hollywood in the future, bringing jobs that will benefit our community and Los Angeles.

Of course, there were also a few setbacks in 2014. In September, construction ceased on a 160,000-sq.ft. Target that is under construction at the corner of Sunset and Western. A judge ruled that the City should not have granted a variance for a height of 75 feet. Now the City must modify the ordinance to allow this usage. More than 200 permanent jobs are now on hold, construction workers were pulled off the job, and Hollywood residents will lose by having to leave the community to do the shopping they might have done here.

On the legislative front, we had one huge victory in the passage of AB1839 – the film tax credits bill that raises the annual credits available in California from $100-million to $330-million. This was the culmination of years of lobbying the State to take decisive action to save our signature industry. This won’t bring back all of the lost business, but it will mean that thousands of local jobs are saved and that more families will not have to be separated due to jobs outside of California. Kudos to our legislators for making this happen.

As we approach the year 2015, I am optimistic about Hollywood’s future. The investment in this historic neighborhood by responsible developers is something for which we can all be grateful. We are indeed making a difference, and showing that Hollywood can be an example for the rest of the region of how to successfully revitalize a community.

Our very best wishes to you for the holidays and New Year!

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Leron Gubler has been serving as the President and CEO of the Hollywood Chamber of Commerce for the past 22 years. His tenure since 1992 continues to oversee the great comeback story of Hollywood.

Business, City of Los Angeles, Community, Economic Development, Employment, Entertainment, Hollywood, Hollywood Chamber, Jobs

Viacom Announcement is Huge for Hollywood

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For those of us who have been working to revitalize Hollywood for many years, the news last week that Viacom has agreed to rent 180,000-sq.ft. of space at Kilroy Realty’s Columbia Square development is welcome news indeed. The media titan has agreed to move its cable television networks MTV, Comedy Central, BET and Spike TV to the complex now under construction on Sunset Blvd. at Gower. How big is this for Hollywood and Los Angeles? Well, let’s just say it is H-U-G-E!

For the City of Los Angeles, the announcement makes a statement that Los Angeles can indeed attract major entertainment firms. Some of the jobs are being relocated from other sites in L.A., but a significant portion are coming here from Santa Monica and Burbank. And these are prestige companies, the type that any city would do almost anything to attract. Not only will these businesses strengthen the tax base of the City, but they will also bring jobs here by the hundreds – to the tune of more than 600.

For Hollywood, the announcement is proof that the Hollywood comeback is for real. For most of the past three decades, companies were leaving Hollywood. We can point to this as evidence that the jobs outflow has now reversed. Furthermore, these employees will spend dollars in Hollywood, at restaurants and retailers, which will strengthen our economy. Finally, it substantiates the fact that Hollywood will remain an important commercial district within the metropolitan region.

For the developers, the announcement will create momentum as far as attracting other companies to Hollywood. Kilroy Realty, Hudson Pacific and J.H. Snyder have made a significant bet on the future of Hollywood by investing here. Hollywood currently has one-million-sq.ft. of office space under construction, more than any place else in Los Angeles. Trophy deals such as this confirm that they made the right decision.

For the Community, the arrival of Viacom is also a huge victory. We have touted the goal of creating a truly great live-work community, where people can reside with only an occasional need for a car. That means putting jobs and residences in close proximity to each other and to transit options. And these are companies that give back to the community. Viacom, through its Paramount arm, has for years organized their annual Viacommunity Days of service, and I imagine we will now see more of that from the new Viacom divisions. Furthermore, we can anticipate that these and other new firms moving here will become part of the community by supporting local arts, education and social service programs.

So, this is indeed a big win for Hollywood. And I can’t think of a better way to bring in the holiday season and to end the year than this. May the momentum continue in 2015!

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Leron Gubler has been serving as the President and CEO of the Hollywood Chamber of Commerce for the past 22 years. His tenure since 1992 continues to oversee the great comeback story of Hollywood.

Business, City of Los Angeles, Economic Development, Employment, Hollywood, Hollywood Chamber, Jobs

Finally, A Little Bit Of Good News For Small Businesses

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It has been a very long summer for businesses in the City of Los Angeles. First, the City Council took a timid approach to promised reform of the gross receipts tax. Next, they passed a resolution (with no discussion at Council) calling for a split roll property tax. Then, they approved the second highest minimum wage in the nation for hotels without regarding the economic studies they had commissioned. And finally, they moved forward on a plan to raise the minimum wage across the board by 47 percent over a three-year period.

Last week, we finally received some good news, when Councilmembers Mitch O’Farrell and Bob Blumenfield introduced a motion asking for an economic analysis of the unintended consequences of increasing the minimum wage, especially as it relates to small businesses and nonprofits.

The result of this motion is that the process for a decision would slow down, and allow the debate to take place that is needed on an action that will impact thousands of businesses. Instead of taking action in January, if this motion is passed, we should see a decision in the spring. Of course, this is all dependent on approval of the motion by the full City Council.

The Hollywood Chamber of Commerce is on record in support of an increase if it is done in a way that minimizes its impact on small businesses. Increases need to be smaller and spread over a lengthier period of time. The City needs to lobby the State to allow tipped wage earners to be excluded from the increase. And the City needs to seriously reform or replace the gross receipts tax in a way that will allow Los Angeles to compete with other L.A. County cities for business.

The Berkeley study commissioned by the Mayor is seriously flawed and underestimates the negative impact of the proposed increase on jobs and businesses. There has never been an increase in the minimum wage of this magnitude over this short period of time. It does not allow businesses the time to adjust to the increase.

We have just completed a study of our own members that reveals that 53 percent believe their businesses would be adversely impacted. If it is enacted as proposed, 27 percent say that they would have to lay off employees and another 39 percent say that they would have to reduce some employees hours.

Studying the unintended consequences of the increase makes sense. Are the benefits of the proposed increase greater than the negatives for those who will lose jobs or have their work hours reduced? What about the $1.8-billion sucked out of the pockets of businesses? Are the negatives of their reduced spending being taken into consideration?

A big thanks to our own Councilman Mitch O’Farrell for making the motion to put the brakes on this increase along with Councilman Bob Blumenfield and seconders Paul Krekorian, Nury Martinez, and Felipe Fuentes. Hopefully, other Council members will take the responsible position and also support the motion. There is no need for a headlong rush to approve an increase. Let the Council take the time to listen to the businesses that will be impacted and to craft an increase that not only helps those on the lowest economic level, but which does the least harm to business.

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Leron Gubler has been serving as the President and CEO of the Hollywood Chamber of Commerce for the past 22 years. His tenure since 1992 continues to oversee the great comeback story of Hollywood.

Business, City of Los Angeles, Employment, Hollywood Chamber

What the Experts Say About Hotel Minimum Wage Job Loss

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Last week, the Los Angeles City Council gave final approval to an ordinance that will raise the minimum wage of hotel workers to $15.37 an hour, the second highest in the nation. In July of 2015, the hike will apply to employees in hotels with more than 300 rooms, and the following year to workers in hotels with greater than 150 rooms.

In 2008, when the City singled out hotels near the airport for a higher minimum wage, the City Council agreed to do an economic analysis before raising the rate beyond the airport area. Three studies were ordered – one backed by Labor, one from Business, and a third from a firm that all parties agreed upon. Unfortunately, the City Council gave little credence to these studies. I thought it might be useful to share with you some of the conclusions of those reports.

Christopher Thornberg of Beacon Economics found that such a steep increase in the minimum wage could result in a sharp decline in the number of jobs in the hotel industry. His study found that since 2007, the number of people employed at hotels in the county has risen by 12 percent, but during the same timeframe, hotel employment has declined 10 percent near the airport (where the hotel wage base had been raised).

He concluded that as many workers might be hurt by the proposed increase as would be helped by higher wages.

Another study by PKF found that if the ordinance were approved as proposed, there would be a “direct impact on new job creation … because developers will not want to risk an investment in new hotels due to the long-term real estate risks.” The study noted that the average annual growth rate for new hotel supply in the City of L.A. is significantly below the national average, resulting in an under-supply of hotel rooms in the market.

The study reported that no new hotels have been built in the LAX Corridor, and only one in Long Beach (which was already under development), since their respective wage hike ordinances went into effect.

Even the Los Angeles Times was critical of the Council, saying that “they’ve ignored unfavorable economic studies, tuned out valid industry concerns and overridden their own existing laws in an effort to enact what is in fact bad public policy.”

I have referenced before that a UCLA study from earlier this year revealed that the City of Los Angeles has one of the worst records for job creation of major cities in the nation – worse than even Detroit and Cleveland. Since 1990, the study indicated the city had lost 3.1-percent of its employment base. There are fewer jobs in the City now than there were 24 years ago.

What people need are jobs and the opportunity to move up. It is hard for me to understand how the action that the City Council took will help create jobs.

The Hollywood Chamber had urged the City Council to not single out the hotel industry but to roll the decision into the broader discussion of the citywide wage hike now being considered. That would have been the far wiser course.

Let’s hope that the City Council has a true debate on the merits and impacts of potential wage hikes before voting on the proposed citywide ordinance later this fall.

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Leron Gubler has been serving as the President and CEO of the Hollywood Chamber of Commerce for the past 22 years. His tenure since 1992 continues to oversee the great comeback story of Hollywood.

Business, City of Los Angeles, Employment, Hollywood, Hollywood Chamber

Potential Loss of Jobs Is NOT a Myth!

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At a debate held last week by the candidates for L.A. County Supervisor, it was reported in the L.A. Times that they both agreed that it is a “myth” that a minimum wage hike would lead to job losses. Well … I think it is time to dispel that “myth”.

The Mayor’s proposal would raise the minimum wage in 2015 from the recent State-imposed rate of $9 to $10.25. In 2016, it would be raised to $11.75 and in 2017 it would go to $13.25. Thereafter it would be tied to cost of living and be adjusted annually.

The proposed hike when fully implemented amounts to a 65 percent increase in the minimum wage. However, when you add in payroll tax increases, workers comp increases and unemployment tax increases, one business told me that they had computed that the effective increase is 88 percent. On top of that, it puts wage pressure on all of the other positions at a business, who will be dissatisfied that their salaries are not also being raised.

The one thing that so many public officials do not seem to realize is that a business must operate at a profit. Many businesses are just barely making it. With tight operating margins, they are fearful of what hikes in the minimum wage will do to their bottom line.

George Abou-Daoud, one of our most energetic entrepreneurs who owns several restaurants in the Hollywood area, told us that when the minimum wage increased from $8 to $9 on July 1st, he had no choice but to close two of his Hollywood restaurants – Mercantile and Township. These restaurants were operating on a tight margin and the hike pushed them over the precipice. Now, 40 former employees are out of a job.

George tells me that he is willing to meet with any politician and show them his books on these closed restaurants so that they can get a better understanding of what it takes to operate a business. He encourages our public officials to speak with businesses like his to get the facts rather than the economists at Berkeley. He supports measures for wage increases, but only if other taxes and fees that would rise are fixed.

The Hollywood Chamber understands the reasoning behind the Mayor’s proposal. We agree that no one working full time should be living in poverty. However, any increase in the minimum wage must be tailored to minimize the impacts on small businesses. Here are the points that our board of directors approved last week as mandatory to earn the Chamber’s support of a hike in the minimum wage:

First, it is essential that the minimum wage increase be phased in over a longer period of time at smaller increments. Perhaps there could be two schedules – one for businesses with more than 500 employees and another for those with less than that.

Second, the business community wants to see immediate and comprehensive reform of the L.A. Business Tax. The City of L.A. currently has the highest business tax in the County – a whopping 9.5-times the average for the other 87 cities. We are never going to be able to address the job growth issue in this City until the Council addresses this onerous tax.

Third, the City needs to abandon its efforts to impose a minimum wage of $15.37 on hotels. It makes no sense to single out an industry like this. There is NO reasonable justification for doing this to our hotels. It places an unreasonable burden on existing hotels and will prove to be very damaging to the effort to attract new hotels to this City.

Fourth, the City needs to actively work (and not just give lip service) to get the State to change its requirement that tipped wage earners also receive the same minimum wage as other employees. California is only one of seven states that have this ridiculous condition. In addition, current State law requires that employers pay taxes on all the tips their employees receive, although it is not income to the establishment. Tipped wage earners already earn significantly more than the minimum wage. By removing this requirement, it makes it easier for businesses to help those truly in need.

Fifth, there needs to be a carve-out for non-profit organizations, who will not be able to perform their work in the community if the minimum wage hike goes into effect.

These steps will not completely offset the pain to businesses from the proposed hikes, but they will certainly help.

As discussions go forward on the proposals, we hope to address what is the real myth being circulated – that you can take $1.8-billion out of the pockets of small businesses and have no adverse impact on jobs!

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Leron Gubler has been serving as the President and CEO of the Hollywood Chamber of Commerce for the past 22 years. His tenure since 1992 continues to oversee the great comeback story of Hollywood.

Business, California, City of Los Angeles, Employment, Hollywood, Hollywood Chamber

Labor Day Should be About Creating Jobs

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In my view, when we celebrate Labor Day it should be about creating jobs to provide opportunity for our citizens. When an economy is strong and when there are jobs, then there is plenty of room for upward mobility.

This past Labor Day, Mayor Eric Garcetti unveiled a proposal to hike the minimum wage in three increments to $13.25 an hour by 2017 and to index it to inflation thereafter. That would be a $10.25 minimum wage in 2015, $11.75 in 2016 and $13.25 in 2017. As this proposal moves forward, it may provide an opportunity to have a healthy discussion not only about the minimum wage but jobs as well.

I think most people would agree that there is a need to adjust the minimum wage. However, the State of California just raised the minimum from $8 to $9 an hour on July 1st. So the question we need to discuss is how much of an additional increase is warranted? When you add the City’s proposed increases to the State’s, it adds up to a whopping 66 percent increase in only three years. That is a substantial amount for many small businesses to absorb.

The City commissioned a study of the proposed hike from the Institute for Research on Labor and Employment at UC Berkeley. They estimate that in the first full year of implementation, workers will earn an additional $1.8-billion. What they fail to say is that this $1.8-billion is coming from the pockets of small businesses.

The study says that about half of all affected workers will be in four industries: restaurants (17.4%), retail trade (13.9%), health services (11.7%), and administrative and waste management services (9.5%). Restaurants, the most-impacted industry, are expected to see total payroll costs rise by 14 percent, but when you add in all operating costs, the study claims it is “only” a 4.7-percent increase in operating costs. They expect restaurants will raise their prices by only about 4.1-percent to recover the additional cost. They note that they “cannot rule out the possibility that the restaurant industry might experience small reductions in growth.”

It seems to me that these consultants are spinning this as a “no pain” wage hike that is going to add money to the pockets of those most in need, and have virtually no impact on businesses. In fact, they say businesses are going to benefit because they are going to see “improved worker performance and reduced turnover.”

If only things were so simple. What the researchers fail to consider is the narrow profit margin within which many businesses operate.

The Daily News ran an editorial yesterday calling for a “full, public debate” not just about the proposed minimum wage, but also “a wide-ranging discussion of what the city can do to lift both workers and employers.” Certainly, if the City took action to do away with the Gross Receipts Tax, then the business community would be more open to the idea of a hike in the minimum wage. Also, the separate proposal to raise the hotel minimum wage to $15.37 should be dropped, with the hotels treated the same as other businesses.

The Chamber’s Legislative Action Committee is scheduled to be briefed by the Mayor’s Office on Thursday, September 11, at 4:30 p.m. at the Chamber. We invite any members with interest to attend. We expect the committee to make a recommendation to the Chamber board for a position.

In the end, it should be all about creating jobs to help those on the lowest rungs to advance. Simply taking $1.8-billion from the pockets of small businesses does not help them to create more jobs! Let’s work together to not only improve workers’ lives but also to improve the business climate.

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Leron Gubler has been serving as the President and CEO of the Hollywood Chamber of Commerce for the past 22 years. His tenure since 1992 continues to oversee the great comeback story of Hollywood.

Business, City of Los Angeles, Community, Economic Development, Employment, Hollywood, Hollywood Chamber

The Bullseye Is On Target

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Over the past year, I have heard from numerous Hollywood residents and business owners who are excited about the new Hollywood Target, under construction at the intersection of Sunset and Western. I did not hear them complaining about the height of the project. They were looking forward to being able to shop close to home.

Now, thanks to the efforts of a handful of naysayers, construction may stop on this important community center, that was scheduled for opening March 2015. If the opponents get their way, 75 construction workers will be laid off and another 200 permanent jobs will be on hold.

And what is their objection? – Target’s 74-ft. height. Never mind that the Walgreen’s center on the opposite corner is almost as high. The opponents were able to prevail with a judge because of an antiquated zoning code known as the Station Neighborhood Area Plan (SNAP) that was adopted in 2001. This ill-conceived specific plan, which was adopted with very little community input, was supposed to improve the neighborhood adjacent to the new subway stations. Its objective was to stimulate development, but in actuality has prevented almost anything from happening. That is why, across the street from the Hollywood & Western subway station, a single-story retail center is being built rather than a more intensive use – because the developer did not wish to deal with SNAP. I have heard the same story over and over again from numerous property owners.

Because SNAP only allows the extra height for mixed-use projects (residential and retail), the Walgreen’s center was allowed. However, because it was strictly a retail center, Target’s height is limited to 35 ft. Now that people can actually see how the Target impacts the skyline, I think most people’s reaction is going to be “what is the big deal?” It fits fine at that intersection, and is a significant improvement from the run-down retail center that previously occupied the site. It is surrounded by commercial buildings. None of the neighboring businesses objected to the height.

Perhaps the best we can hope to salvage from this sad situation is if it provides the impetus for the City Council to finally amend SNAP to remove the provisions that have harmed that neighborhood. I say: Let’s get on with it, so that construction can be completed on the Target!

If you agree, please send our Hollywood-area council representatives an email at: [email protected]; [email protected]; [email protected]. In this situation, it is all about jobs, and shopping opportunities, and an improved quality of life for Hollywood.

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Leron Gubler has been serving as the President and CEO of the Hollywood Chamber of Commerce for the past 22 years. His tenure since 1992 continues to oversee the great comeback story of Hollywood.

Business, City of Los Angeles, Community, Economic Development, Employment, Hollywood, Hollywood Chamber

Assessing the Fault

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Over the past year, there has been a great deal of debate about the Hollywood fault.  A lot of heated rhetoric came from opponents to the Millennium Hollywood project, who seized on the fault issue to try and stop the development.  Now, finally, we are beginning to see a little clarity on this issue.  We may not know exactly where the fault is, but we do know where it isn’t.

In a press release issued last week, Millennium Partners and Argent Ventures announced the results of the “most extensive urban fault investigation ever undertaken in California” that “conclusively found no evidence of an earthquake fault on their property.”

The study was conducted by Group Delta, a geological and geotechnical engineering consulting firm that they and three other property owners hired.  The firm found no active fault traces on any of the four properties.

Then, on Thursday, at a public hearing held in Sacramento by the State Mining and Geology Board (SMGB), the executive officer of the board, Steve Testa, reviewed the data, said that he had made direct geologic observations of the fault trench walls and had studied the preliminary data that had been generated.  He concluded with this statement:  “Should the conclusions set forth prove definitive, such results would be cause for modification of the earthquake fault zone map within the subject area.”

The SMGB board voted to adopt his recommendations and forwarded those, along with 200 pages of testimony to State Geologist John Parrish, who has the final say on how the Hollywood Fault Zone map will be drawn.  He has 90 days to make his decision – until November 14th.

The detailed documentation for the conclusions drawn by Group Delta will be completed and submitted by the end of August to Mr. Parrish.  We trust he will wait for that data and study it, as recommended by the SMGB, before issuing his final map.

If the data holds up, as the SMGB executive officer believes it will, then these four properties should be removed from the map, so that they can move forward with their development plans, which will create hundreds of needed jobs here in Hollywood.

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Leron Gubler has been serving as the President and CEO of the Hollywood Chamber of Commerce for the past 22 years. His tenure since 1992 continues to oversee the great comeback story of Hollywood.