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Thursday, Sep 21, 2023

Alliance Faces a Changed Valley

In 1995, with an economy still anemic from the loss of the aerospace industry, the community still jittery over the Rodney King riots and whole neighborhoods still littered with rubble from the Northridge Earthquake, a small band of business executives met to determine how best to revitalize the economy of the San Fernando Valley. Today, the damage from the earthquake has been repaired or rebuilt, the defense-based economy has been replaced by a diversified mix of industries led by entertainment, and business, in many ways, is thriving. Now, as it prepares to celebrate its 10th anniversary the group formed to help the rebuilding effort, the Economic Alliance of the San Fernando Valley, finds itself at a crossroads. The need to continue economic development efforts persists, but the tools it will require going forward are different. “If the Alliance is going to be successful in the next 10 years it’s going to have to become more nimble, attack change more aggressively and become more ambitious in its goals of obtaining and retaining business,” said Martin M. Cooper, a member of the executive committee of the Alliance and chairman of the Valley Industry and Commerce Association. “I think that’s the organization’s biggest challenge in the next decade.” To be sure, the group has much to crow about. It has given the Valley an identity that goes well beyond its heritage of malls and Valley girls. It has helped to develop customized job training for dozens of businesses and thousands of workers. It has compiled data that has helped to define and analyze the Valley and its economy and demographics. And it has helped businesses to expand or survive, saving jobs and keeping the region’s economy stable. “I think it’s been a home run,” said David Fleming, who has served as chair of the Alliance for most of its existence. “We did something that’s never been done before, and that is to bring all the disparate groups together and raise money. We go out, we sponsor seminars in education, transportation and all these things that directly affect the business environment. In the final analysis it has been everything we had hoped for and maybe a little more.” Of course, the Valley’s recovery from the earthquake and the recession of the 1990s had little to do with the efforts of the Alliance. The group never received the federal funding monies it anticipated when it was formed, limiting its impact. And much of the $5 million raised in the private sector over the first five years was devoted to paying operating expenses and launching a marketing campaign for the region. But the Economic Alliance did succeed in mobilizing the community around common issues and concerns, and it began a process of defining the Valley that continues to assist the region in grabbing political and economic clout today. “I think the Alliance has been an amazingly effective organization,” said Gerald E. Curry, a Canoga Park attorney who was chair of the United Chambers of Commerce when the Alliance was formed and a member of its founding executive committee. “They’ve done a really good job of branding the Valley of the Stars and the education initiative has done very well also.” Whether because of its resources or the need to find areas of consensus among a founding group that numbered more than 100 board members, most of the Alliance’s early years were dedicated to marketing the Valley. Under the direction of Bill Allen, the organization’s first president, the Economic Alliance developed a Valley of the Stars campaign to promote the idea that the region housed much of the city’s entertainment industry, albeit its less well-known faces. “Like good entertainers, they knew how to sell the sizzle and not the steak,” said Jonathan Goldhill, now CEO of The Growth Coach, who was a member of the original board of the Alliance. “It was something everyone could get mobilized around. It made sense and it hadn’t been done (before).” Changes in area But the Valley has changed dramatically since that first fateful meeting in 1995. Businesses are grappling with issues like workers’ compensation and health care costs that cannot be solved on a local level. The population has changed, and today’s ethnically diverse mix of businesses and residents are not as likely to join community groups like the Economic Alliance, making the organization’s efforts less relevant. Political priorities have shifted to providing housing, not jobs. And job training has become ever more difficult with a population that often does not have basic education or language skills. Then too, some say it has lost some of its earlier visibility as the economy and needs of the area have changed. “My sense is they’ve continued to do studies, but I haven’t read them,” said a local business executive who was involved with the Alliance in its early years. “My sense is they have been doing these conferences on promoting trade and discussions on transportation issues. I don’t know what else they’re doing. I don’t think it’s that visible. I don’t know that many people involved with them.” Things were a lot simpler in the wake of the Earthquake when Benjamin Reznik, now a partner heading the land use practice at Jeffer Mangel Butler & Marmaro LLP; David Honda, president of DS Honda Construction Inc., and Bob Scott, who now runs CivicCenter Group, got together to try and access government financing that was available for economic development efforts. The earthquake left many businesses devastated large numbers were packing up and leaving and keeping them became job one. “We created the Economic Alliance, and got our initial funding from the Department of Commerce to try to coordinate earthquake recovery efforts,” said Reznik, who, along with Honda, was co-chair of the Alliance when it was founded. “But it was also about the creation of jobs. It was the first attempt to try to take a more organized approach to the future of the Valley.” With $350,000 in seed money, a small group of businessmen working out of the Valley Economic Development Center hired Stanford Research Institute to conduct an economic analysis of the area, and members of most of the Valley’s business groups, including the Valley Industry and Commerce Association, the United Chambers of Commerce and the VEDC, were marshaled to survey the needs of business. What emerged was a four-point plan that is still at the center of the Alliance’s work today. Businesses would need to be retained and helped to grow, the quality of life in communities would need to be nurtured, the workforce would need to be trained in skills relevant to the new, emerging economy now dominated by entertainment, and the Valley would need to be marketed as a place that provides a healthy business climate. In order to show that its plan had a broad enough base of support to qualify for a portion of the $30 million available in grant money to help turn local economies around, the Alliance brought in members from nearly every corner of the public and private sector, creating a huge, some might say unwieldy, infrastructure. “We called it an alliance because it was an alliance of those groups,” said Scott, who was founding president of the Alliance and continues to serve the organization as executive vice chair. “We literally went out and essentially polled everybody to find out what the issues were. I don’t think that had been done before.” Finding problems Indeed, those initial surveys opened a floodgate of issues ranging from frustration over business taxes to difficulty working with the city’s government bureaucracy, problems with crime and traffic congestion. Just as important, the SRI survey revealed that the Valley was contributing a large amount of tax money to the finances of the city and not receiving a proportionate share of services in return. Ultimately those early efforts would set the stage for a secession movement, give rise to business tax reform and usher in a seismic shift in government, giving Valley residents and businesses a seat at the civic table. But the Economic Alliance of the San Fernando Valley, cannot lay claim to any of those things. A 501C3 organization, the Alliance was obliged to steer clear of any political advocacy. Even more problematic, it had to be careful not to usurp any of the territory claimed by its many partners. Even today, nearly any discussion about the Alliance’s programs and results is peppered heavily with references to the myriad of organizations the group calls its partners. And as the Alliance has persisted in its efforts to be the glue that binds all the other Valley business groups together, some say it has sacrificed some of its own identity. “There’s a lot of confusion about the Economic Alliance,” said Judi Rose, who joined the Alliance in January as director of resource development to help bring more visibility and funding to the group. “It shouldn’t be unclear. Part of the reason it’s unclear is the public face has been wedded to this partnership. We have referred to ourselves for years as a collaborative. We’re not. We’re a standalone organization.” Limited budget The many partnerships the Alliance has established have helped it to extend its reach into the many areas where the group works, despite a limited budget of just over $1 million and nine staff members. Through its affiliation with the Valley’s local community colleges, the Alliance last year alone trained over 2,500 workers at 22 businesses. The assistance it has amassed for its red teams has helped with business retention efforts. “Last year we had physical contact with a little over 100 companies, and the job count was 3,000 jobs,” said Bruce Ackerman, who has been the Alliance president and CEO since 2000. “I think we lost two companies.” The agency has produced reports on issues as diverse as housing and health care. It has produced research and data about the Valley through its Vision 20/20 program. It has worked with the American Institute of Architects to develop a master plan for redevelopment of Panorama City. And it has expanded the clout of the region by reaching out to neighboring cities. Ackerman believes that concept of the Valley as a five-city region may be the Alliance’s greatest achievement. “If you and I had been having this conversation 10 years ago, the San Fernando Valley did not include Glendale or Burbank or Calabasas or San Fernando,” Ackerman said. “The Valley’s image is greatly improved over what it was 10 years ago, and this organization can understandably take a lot of credit for that. There was nobody promoting the Valley as we did.” But while these partnerships have helped the Alliance to accomplish its goals, some say they have also sent the group into arenas that are less appropriate, and less effective. “I think one of the real highlights of the Alliance is the area of workforce development,” said Cooper. “I’m not sure what it does in terms of economic development to be the named sponsor of a local parade. I don’t see that as an economic development activity.” If accommodating so diverse a group has been a difficult balancing act so far, it is likely to get harder still as the Alliance grapples with such issues as the growing ethnic diversity of the Valley and the particular needs of some of its low income areas like the Northeast Valley, especially as funding sources for organizations like the Alliance are shrinking. The Alliance will have to find a way to recruit new members that reflect the changing ethnicity to its board and to make an impact in new areas, such as the Northeast Valley with its weak economy and high unemployment rates. Ackerman concedes that such issues as the housing crisis and ethnic diversity will be paramount in coming years, and the organization has taken steps to become involved. He points to the Alliance’s work with the AIA in Panorama City, ongoing discussions with a number of housing developers and what he expects to be a coming focus of the group in the Northeast Valley. The Alliance’s leadership, which has remained largely the same for a number of years, is becoming more diverse, he added. “Would I love to see even more? Absolutely, and we continue to be committed to that concept,” Ackerman said. “It’s not an issue. It’s a challenge. How do you identify those corporate leaders who are ethnically diverse that want to get engaged in the programs available?” But as it has in the past, Ackerman noted that the Alliance will continue to be aligned with the major issues facing business, and not necessarily the agency that solves these problems. “We are not the cure all,” Ackerman said. “I don’t have enough staff, and we don’t have enough money to do everything ourselves. What we can do is make the contacts, do the studies and put that information out there and encourage developers to take a look at it.”

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