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Friday, Jun 2, 2023

N. Valley Enterprise Zone Unexpectedly Helps Others

When Governor Arnold Schwarzenegger announced in December that he was extending the Hollywood enterprise zone to include Pacoima, many in the business community were relieved. The northeast Valley had lost its zone a month earlier, along with all of the important economic incentives, tax credits and financial assistance that went with it. Schwarzenegger’s action was seen as a reprieve, but it also had an unforeseen side effect: by connecting the Hollywood zone to Pacoima, businesses in well-to-do areas in between such as Studio City and West Toluca Lake were suddenly made privy to a wide assortment of financial incentives intended for businesses in economically distressed areas. “It came absolutely as a surprise,” said Tony Safoian, president of the Universal City North Hollywood Chamber of Commerce, who was unaware of the new incentives before an official from the city Community Development Department called earlier this year. More than two months later, however, many qualified businesses are still in the dark about the enterprise zone program and are missing out on thousands of dollars in lucrative incentives. “I had no idea,” said Rodger Boaz, owner of L.B.M. Products Inc., a small tool and die shop on a portion of Chandler Boulevard in North Hollywood that is part of the new zone. Boaz, whose family has owned L.B.M. for 50 years, said he’s never heard of the program but was interested in how it could benefit his five-employee shop. “It depends on what it entails,” he said. “If it could help my business, yes. I’d just like to know what it includes.” Renewed zone The state created the enterprise zone program in 1986 to boost businesses in underserved or economically stagnant areas by giving companies up to $35,000 in employee tax credits, expense deductions, sales tax credits and reduced utility fees. The Pacoima zone was granted in 1986 and is credited with improving the climate for small businesses. The state, however, said the renewal application submitted last year by the Community Development Department failed to show the area was under economic distress and was ultimately denied. After a flurry of resistance from business interests, Schwarzenegger stepped in and tacked on Pacoima to the existing Hollywood zone, which encompasses a large swath of the L.A. basin from just southwest of downtown north to Silverlake and west to Laurel Canyon Boulevard. Schwarzenegger’s move extends the zone further north and west through the Cahuenga Pass and along a mostly rectangle-shaped section between Tujunga and Vineland avenues to Sherman Way. The zone then fans out to roughly Kester Avenue, stretching northeast to include Sylmar and Pacoima and wrapping north around the city of San Fernando. The reconfigured boundaries add several areas not part of the first enterprise zone, including large chunks of Sun Valley, Arleta, Panorama City, North Hollywood and portions of Studio City, West Toluca Lake and Van Nuys. “This is all new,” said Clifford J. Weiss, a deputy director in the Community Development Department, pointing to a map of the new zones at an event last month. “There are thousands of businesses in there that could benefit from this.” Despite that possible impact, however, chamber officials and businesses say the city has made only limited efforts to get the word out about the zone and have scheduled no workshops in the Valley. For the moment, the Community Development Department is participating in some forums hosted by business groups and chambers of commerce, such as the one earlier this year by the Universal City North Hollywood Chamber of Commerce. Safoian said about 30 businesses participated, some of whom applied for credits right away. Still, he questions whether the city and the chamber are helping businesses enough, especially with something that could so clearly benefit bottom lines. “I don’t know how well organized (the city is) on a mass scale informing people the enterprise zone has changed,” he said. “But I wish they were doing some footwork in these neighborhoods.” Chamber not told Richard Bogy, president of the Toluca Lake Chamber of Commerce, said his chamber was never told by the city that a portion of its coverage area was part of the new zone a portion of Lankershim Boulevard near Camarillo Street. “We found it and then went to them and said ‘tell us about it’,” he said. The chamber discovered about 25 businesses could benefit, and it held a meeting last week. “We’re lucky that that corridor was needed to connect the two sides,” he said. Bogy chided the city for staying silent too long about who could benefit. “We told them they need to do a better job initiating discussions,” he said. Weiss defended the city, saying they want to help and are planning a workshop in the Valley in the fall. The department also has a feature on its website that allows property owners to determine if they are in an enterprise zone. “We’re trying to get the word out,” he said, adding later, “We have a small staff and have to get around the entire city.” Regardless, Bogy said the city has the responsibility to tell businesses. It has to step up. “It doesn’t matter. Someone tell us,” he said.

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