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Monday, Apr 22, 2024


By HOWARD FINE Staff Reporter Fed up with L.A.’s taxes and bureaucracy, many San Fernando Valley business leaders say they are ready to support secession if they don’t see substantive changes in city government. “There is an urgency among business leaders and big employers in the Valley regarding the city’s attitude toward business,” said Ric Hill, a spokesman for 20th Century Insurance Co. in Woodland Hills. “There is a palpable sense of frustration among these business leaders that the city will often take a punitive and retaliatory approach toward business,” Hill said, adding that his company has not taken a stand on secession. “It’s very possible that this frustration with the city may push some businesses toward the secession camp.” The frustration is evident at Precision Dynamics Corp., a Pacoima maker of hospital identification wristbands that employs 350. Precision Dynamics President Walter Mosher said the city’s tax structure and lack of attention to business concerns has soured him on remaining in Los Angeles. “The business taxes here are outrageous. And the City Council runs its own fiefdoms; it doesn’t give a hoot about business,” Mosher said. “We need more accountability. I tell you, if charter reform doesn’t happen, we will look at secession. And if neither happens, we’ll be out of here and into a facility in Kansas that we obtained through a recent acquisition.” So far, most of the support for Valley cityhood or at least a formal study of the concept appears to be coming from small to mid-size companies based in the Valley. Meanwhile, Valley-based companies with broad, statewide constituencies like WellPoint Health Networks Inc. and Anheuser-Busch Inc. are declining comment on the issue. And the Valley Industry and Commerce Association, which represents many of the Valley’s major employers, has not taken a position on secession and is not expected to do so until feasibility studies are completed, said Bonny Herman, VICA’s president. But the United Chambers of Commerce of the San Fernando Valley, an umbrella organization of 23 chambers representing 9,000 businesses with a total of 300,000 employees, is supporting a petition drive that would require the Local Agency Formation Commission to conduct a feasibility study on Valley cityhood. “We’ve had 25 years of frustration with the leadership of Los Angeles not being responsive to the needs of the Valley. We’ve tried everything, and so far we haven’t gotten the change we need,” said Gary Thomas, president of the United Chambers of Commerce. Compared to VICA, Thomas’ group is more reflective of small business owners in the Valley. Thomas, however, said the United Chambers would defer taking a position on secession itself until the anticipated LAFCO study is completed. Attorney David Fleming, chairman of the Economic Alliance of the San Fernando Valley, sees momentum building for secession unless City Hall takes steps to improve the business climate in Los Angeles and to make government more responsive through the charter-reform process now under way. “Taxes and regulation relief are the two things that businesses are interested in. The city is losing the war in competition because the business tax is higher here than almost anyplace else,” Fleming said. “Major corporations call me and say, ‘We’re interested in doing business in Southern California and Los Angeles County. Look anywhere for us except the city of Los Angeles.’ They say that because of what they have to pay in business tax, because they have to go to all these different departments to get things done,” he said. Although he has not yet taken a position on secession, Fleming said the concept of a new, startup city could be very appealing to business. “In a new government in the San Fernando Valley, you can start fresh,” Fleming said. “You can set up a government much like Burbank or Glendale, that attracts business.” Mark Pash, owner of Van Nuys-based Pash & Bensen, a certified financial planning company with 60 percent of its clients based in the Valley, said he likes the idea of a government closer to home. “On the surface, it makes sense that those who represent the Valley should represent smaller constituencies than they do now. Government should be far more decentralized,” Pash said. However, Pash stressed that his stance is not cast in stone; he wants to see more numbers and economic data on what secession would mean for his business before making a final decision. Biomedical entrepreneur Alfred Mann, who runs two Sylmar companies MiniMed Inc. and Advanced Bionics Inc. said he has mixed feelings about secession. “As a business person, establishing another layer of bureaucracy, in my view, is not in the interest of business or the public. But, if the current system is dysfunctional, you must do something about it. Whether secession is the right way, or whether something like charter reform is the way to go, is the real question now,” Mann said. Some business people actively oppose secession. Mark Friedman, owner of Blue Cross Beauty Products in Pacoima, said he doesn’t believe Valley businesses would come out ahead if the Valley chose to secede. “Why secede and tamper with something that isn’t broken? I know this isn’t popular, but I’m very cautious about moving into uncharted territory like this. All sorts of promises will be made that, if the Valley secedes, your taxes will be lower. We simply don’t know that and we won’t know that until the secession actually takes place. I just don’t want to go through that,” Friedman said. Friedman generally had positive views of the city bureaucracy. “They (L.A. city officials) have always been there when I’ve needed something done. I have no complaints,” he said. For some businesses, like iMall Inc. in Studio City, executives are too busy running their companies to take a stand on the secession issue. “I’ve been so busy, running so fast with my business, that I really haven’t had time to follow the issue. I certainly haven’t had time to consider the issue either way. And the other business owners I’ve talked to also aren’t talking about this,” said Richard Rosenblatt, chairman of iMall, an online shopping service.

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