Controversy Erupts Over Public Funds Slated For Farmers Field’s Architectural Firm

LOS ANGELES (CBS) — Jeff Dietrich serves a thousand meals a day at his soup kitchen on skid row. He sees the poor and needy firsthand.

But he does not see why a $1 million of taxpayer money, that could go to help the people on skid row, is ending up in the hands of one of the world’s largest architectural firms. The money is slated to go to the firm that designed Farmers Field, the new, privately-financed football stadium.

“When you drive around here and see all the people on the streets pushing shopping carts, when you see them lying on the streets, when you see them homeless, you have to ask yourself how can you use money for that type of activity,” Dietrich said.

But we found that is just what the mayor is proposing.

After promises of no public money going to the stadium project, he has OK’d $1 million of federal community development block grant money, earmarked to help the poor and needy, to go to the Gensler Architectural Firm.

They are moving from Santa Monica to a building dubbed the “jewel box” in Downtown L.A. The money is for rehabbing the building to turn it into a trendy office complex for 250 employees.

“People are really mad,” said Becky Dennison of the L.A. Community Action Network — a group devoted to protecting the rights of the homeless.

“I think it’s pure politics and driven by the stadium project,” she said.

Through the Legal Aid Foundation, they filed a complaint with HUD, which administers the money, alleging mismanagement of the community block grant funds.

“I think we’ve said from the beginning we didn’t oppose the stadium project, but we didn’t want public money and we didn’t want backroom deals. And that’s what we see.”

HUD responded saying Gensler is eligible for the money, as long as they create just 29 new jobs. At least 51 percent have to be held by low or moderate income workers, who have no more than a high school education.

It sounds easy enough, but even people within the city questioned it. In e-mails obtained by Legal Aid, one person involved with granting the money said, “This project could meet a national objective, public benefit, etc. But I imagine this will not.”

Mark Lewis and his wife, Beth Mueller, tried to get some of the same public funds that went to Gensler. Through the Central City Community Outreach, a church on skid row, they proposed more than two-dozen programs to help the needy. All were turned down.

“There are better ways to spend a million dollars and provide a lot more jobs,” Lewis said.

Despite some of the questions and despite the fact that Gensler still has not said what jobs would be created and how, the City Council approved the mayor’s proposal. The company and the city are still working on the final agreement before the money changes hands.

“It’s part of an effort to revitalize the city and it’s an effort that I stand by,” Mayor Antonio Villaraigosa said.

He says Gensler will bring hundreds of jobs to Downtown L.A. and that the money has nothing to do with football.

“This is public money going towards the stadium,” I asked the Mayor?

“Actually, it’s not. It’s public money going to job creation going to provide more revenues,” Villaraigosa said.

But critics say that will never filter down to those who need it the most.

“I don’t think anybody on this street, I don’t think any poor person, is going to get any of those jobs.”

They claim that is where the money should go, not to a company with ties to a stadium that is supposed to be built without public funds.

More from David Goldstein
  • Xen

    That million dollars is part of an investment which will help bring much needed revenue to the city of Los Angeles which in turn could fund programs to help the homeless of skid row. Give the million to skid row and it’s a one shot deal.

    • Astonished

      So, do you also believe in Regan’s Trickle Down Theory too? I ask because, as I should point out, that theory didn’t pan out for the average taxpayer or worker and neither will this. The money is going to spruce up an already expensive office manse, not create jobs.

      • James McCuen

        I think you both miss the point – If you look at this from a regional or even very local perspective – This did not benefit the region or County since it resulted in a loss to the City of Santa Monica and a gain to the City of LA.

        But it has NO net gain to the County of Los Angeles.

        And it provides a Government Handout to a Corporation (Corporate Welfare) or a gift of public funds.

        This needs to be investigated.

  • paul

    all their doing is creating more violence in los angeles by bring a football team here! most football players are gang memebers! nowadays the sports life style incourages that thug life, so why fund bad behavior! feed the homeless NOT violence!!!

    • Jaided

      Paul u are dumb. I dont usually comment on dumb comments. But yours takes a trophy home. dumbest comment ever.

  • Duh!

    This is a prime example of the old adage, “Give a man a fish and he eats for a day. Teach a man to fish and he eats for a lifetime.”

    Just giving things to homeless people will not entice them to not be homeless. In fact it has the opposite effect. They can remain homeless and get free hand outs.

    But providing them with a job so that hey can get themselves off the street, that will be most beneficial. However most of the homeless people have it so nice they do not need to work, they don’t pay bills, and they are provided meals free of charge. So there is no motivation to get off the homeless gravy train.

    • noneoff

      That’s all well and good, then setup job training for the poor and homeless, and doesn’t give in to the need for a new football stadium.

    • John Ashton

      Your comment was making sense for awhile then you went totally off the deep end. ‘most of the homeless people have it so nice they do not need to work’, get real.

    • Astonished

      ????? Dude are you actually refering to the homeless I see walking around Skid Row on a daily basis? Because I don’t see how is sleeping under an overpass, begging for food, smelling like your the walking dead, and being a target for everyone with a chip on their sholders, betting beat up on and robbed equates having “it so nice that they don’t need to work.” It looks like living in Hell to me.

  • rich

    i agree if they spent a million on the homeless there is no RETURN on the money. they would feed x-amount of people with it and it would be gone. spend it on something that creates jobs and it pays for its self

  • Pat

    This article is disingenuous and manipulative. If you want to do stories about public monies that “could have fed the homeless”, you’d never stop writing. This money wasn’t taken from a big jar marked “homeless people fund – do not remove”

  • Armin

    How exactly is the money going towards the stadium? Even though it appears Mr Goldstein tried his hardest to make a connection it’s clear that there is none. This whole story just reeks of absolutely shoddy “journalism.”

    Aside from Gensler’s new office space being “trendy,” Mr. Goldstein fails to note that except for a ground floor food court, the Jewel Box has been empty for more than a decade and its renovation has provided many construction jobs.

    By plucking 250 employees from Santa Monica to downtown the city has pulled a pretty nice coup. Just the tax dollars alone from 250 people eating lunch in LA rather than Santa Monica will more than offset the one million dollars.*

    *please read that last part in your best Dr Evil voice

    • Ironica

      At an average of $15 per lunch, EACH of those 250 employees would have to eat more than 3,000 lunches downtown before we’d see $1 million in sales tax revenue. That’s 12 years of lunches.

      Apparently HUD lets private entities spend nearly $35,000 per job they create. That’s fascinating, considering our organization’s CDBG grant for Workforce Development has spent less than $5,000 per homeless participant who we’ve helped to secure permanent employment (including transitional housing, employment preparation, vocational training, and job placement services). $35,000 is enough to employ a person full-time… how is that “job creation”? Why doesn’t the City just hire 29 people directly with that money?

      • Armin

        Actually, based on your math, $15 spent by each employee each workday comes out to $1million in sales tax in 10.5 years. That’s just factoring in “lunches.” That 10.5 year time frame will likely be lessened as these employees will no doubt be making other purchases in downtown and the city of LA rather than Santa Monica.

        Considering Gensler called Santa Monica home for 20 years it’s a pretty safe bet that they will be in downtown for the long haul.

        250 employees spending $15 per day = $3750 which amounts to $365.63 in sales tax at 9.75%.

        365.63 x 5 = 1,828.15 x 52 = $95,063.80 in sales tax per year.

        1,000,000/95,063.80 = 10.52 years.

  • KeithS

    Villaraigosa is a do-nothing mayor who is giving off the illusion he will be helping the city by putting our money into the stadium. It will do nothing except secure him two luxury box seats where he can take Lu Parker for free. This guy always puts himself light years ahead of the homeless anyway. He cares about the stadium because there is a payoff for him, he is not doing it for the “good” of the city.

  • Deflectr

    Fantastic work KCAL. I love stories like this, brilliant, keep them coming!

    • Pat

      How do you know the report is accurate?

      • cb

        Because if it wasn’t, the city would come out in response to the story and say it was not true. They haven’t done that. In fact, they confirmed it with the quotes above. Did you see the quote from the Mayor?
        If CBS, a national network, gets that wrong, you better believe the city would be yelling and screaming to put it right.

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  • James McCuen

    If you were creating a new company or bringing in an out-of-state company, perhaps you could argue that this is a benefit to the community.

    However, all this has done is to move an existing firm about 14 miles from its previous location in the same County – Los Angeles.

    Therefore this results in a Zero net gain to the Region and a Zero net gain to the County.

    More importantly, this could be argued to be a gift of public funds and could only be vetted out through a Federal or State investigation since the LA County DA is not truly capable of dealing with larger Cities such as Los Angeles. He is best experienced at investigated small Cities such as Bell or Vernon.

  • disgruntled

    laying off santa monica employees to make the 29 emloyee threshold. nice one, gensler.

  • Randy Weller

    Oh hey since they called GREEN.. the white house is kicking in the money…

  • Rey Ybarra

    This is why I am adamant about NOT bringing an NFL team to LA! Photo-Raigosa is a crook and one way or another, The TAXPAYERS are going to end up paying a lot of tax payer dollars for this project!! Guaranteed!!! Just look at the major corruption with our politicians alone in this city. From Free-Load-a Raigosa’s not tickets and perks to Robert Rizzo’s enormous pay to Jerry Brown’s pandering to the powerful unions and his never ending wanting to raise permanent temporary taxes!!! This is a corrupt NFL deal that is nothing but a ROOSE!!!!!!!!!

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