A forgotten economy.

5 Years After Riots Gutted South Central L.A., Residents are Fighting To Cope, to Rebuild And to Find Community

While the embers from the 1992 riot still smoldered, Los Angeles officials announced swift plans to infuse the devastated South Central community with millions of dollars in new industry and the creation of thousands of jobs.

Mayor Tom Bradley moved quickly, forming Rebuild L.A. and recruiting former Major League Baseball Commissioner Peter Ueberroth to head it. Nearly 100 of the region's top financial, government and community leaders were named to its board and given the task to somehow revitalize riot-torn South Central in five years.

That timeline expires this Tuesday - the anniversary of the day a jury acquitted four LAPD officers in the beating of black motorist Rodney King. Three days of arson and looting left 52 people dead, destroyed more than 2,000 buildings and caused nearly $1 billion in property damage.

Now, five years later, what has been accomplished? A tour of South Central Los Angeles reveals a living, breathing economy - but also one with limited expectations.

While there are new fast-food restaurants, auto parts stores and supermarkets. there also are at least 150 vacant lots where buildings once stood, but were burned in the riots and never rebuilt.

Cutbacks in aerospace and defense spending that hit Southern California in the 1990s were particularly creel to South Central. The closure of the Todd Shipyards in San Pedro and cutbacks at McDonnell Douglas in Long Beach, for example, eliminated opportunities for high-paying factory jobs - the kind of jobs that can't be found at McDonald's or Burger King.

Organizers of Rebuild L.A. - now known as RLA - recognized the need for major new manufacturing centers early on, but ultimately concluded that the task was beyond their resources and refocused on supporting smaller scale efforts in industries such as ethnic food processing and furniture making.

While such efforts have had limited success, most observers agree that South Central Los Angeles - the core of the riot area - remains a blighted community with limited job opportunities and harsh prospects for startup businesses.

"The miserable social-economic condition that was evident in South Central five years ago continues today," said Melanie Lomax, an attorney and community activist who served on the Christopher Commission after the King beating.

"Look at the number of damaged buildings from the riots, the businesses that were burned and never returned. Look at the blight and you'll still even see evidence of the 1965 riots," she said.

Statistics portray South Central

In fact, the number of businesses operating in South Central has actually declined from 18,429 in 1992 to 17,034 in 1996, according to the most recent figures from the City of Los Angeles.

The numbers are based on business licenses in L.A. communities generally bounded by the Santa Monica (10) Freeway on the north, the Anderson (105) Freeway on the South, Fairfax Avenue and the San Diego (405) Freeway on the west and Alameda Street on the east.

In part, the numbers reflect the recession that hit the entire Los Angeles area. They also are open to varying interpretations. Economic researchers consulted by the Business Journal put the actual number of operating businesses in the area at about 13,000. (The smaller number may reflect the fact that many people with business licenses perform only part-time or seasonal work).

A review of the types of companies in South Central conducted for the Business Journal also shows that the area is dominated by businesses such as auto repair shops and small retailers. About 64 percent of the workforce is employed at firms with under four employees.

The employment problem is compounded by a lack of investment capital for start-up firms.

Efforts to improve the situation have not yet been a success. For example, a Community Development Bank founded with $430 million in federal funds 18 months ago to infuse much-needed capital into the inner city has only made two loans totalling $2.7 million under its co-lending program with private-sector banks.

"I think we're much better off, but that doesn't make me happy," said Mayor Richard Riordan, who was elected a year after the rioting. "We started after the dots at zero, and still have a tough job ahead of us. We've improved retail stores but still have to restore manufacturing."

What RLA has done

RLA, which is disbanding but whose work is being carded on by a group called L.A. Prosper Partners, issued a final report last week that emphasized accomplishments on several fronts:

* Forty-four corporations committed $497 million for riot recovery programs, including job training and business development, of which $389 million has already been spent, according to Linda Griego, who was president of RLA from 1994 until late last year. RLA officials cannot say how much of that was spent specifically in South Central L.A.

* An estimated 1,600 new stores and businesses opened in the South Central area, although many of these stores simply replaced others destroyed in the riots.

* RLA helped facilitate the opening of 18 supermarket chain stores and five independent markets in what RLA calls economically neglected areas. These areas are scattered throughout the county, but are concentrated in the Harbor Freeway corridor between downtown L.A. and Long Beach.

Indeed, plenty of new development can be seen when driving through South Central Los Angeles. But those signs of progress must compete for attention with the empty lots and boarded-up buildings still sprinkled throughout South Central.

"There is a gas station at the comer of Florence and Normandie, and that gas station still remains burned-out from five years ago," said Marva Smith Battle-Bey, president of the Vermont Slauson Economic Development Corp.

Battle-Bey pointed out that a burned-down gas station "wouldn't stay that way for five years if it was somewhere on the Westside."

The vacant lots underscore the fact that South Central is still not back to where it was before the dots - and that's not saying much, said Councilman Mark Ridley-Thomas, whose district includes South Central.

"We need cooperation from all sectors of the city to bring in the kind of businesses needed to transform the economy," he said. "This is not about returning to the levels South Central was at when the riots happened. We have to go much further ... we've started that process, but much more needs to be done."

A low-tech community

An early goal of RLA was to find new manufacturing jobs for South Central, but the end of the Cold War and changes in the nation's economy forced RLA to change that strategy, and to focus more on encouraging smaller businesses.

"It was unrealistic to think we could build new factories in South Central," said Griego. "We were in the middle of a recession, and the area needed more immediate impacts" such as restoring burned-out neighborhood markets.

With prospects for new factories bleak, and government funds limited, community activists like Battle-Bey conclude that residents must take the initiative by working to build small business in South Central.

"We've got to do it on our own," she said. "Now, this isn't about high-tech. This is about low-tech - we're talking about helping the basic, raw level of community ... the people who live and work in South Central."

But during the past five years, private investors have been skeptical about putting money into South Central, said Jose Legaspi, president of The Legaspi Co., a brokerage for commercial investment real estate.

One of the best hopes for the area might be the Los Angeles Community Development Bank, created 18 months after the riots as a way to identify seed money for new business. It was created by President Clinton after South Central was passed over as an empowerment zone, and is funded by a $430 million federal grant.

Turnaround on race relations

Some observers also believe that race relations have improved substantially - and with that improvement come prospects for better business opportunities.

Tensions between Korean Americans and African Americans reached a boiling point during the riots. The turmoil had been building since the 1980s, as more Korean Americans opened businesses in inner-city areas - leading to conflicts between store owners and their customers.

"After the riots ... Koreans and blacks began a dialogue, with many bi-cultural groups formed to do just that," said Eric Shockman, a professor at the University of Southern California.

In the end, most observers seem to agree that the riots focused attention on the need to improve social and economic conditions in South Central Los Angeles, as the Watts Riots did in 1965.

In both cases, the turmoil resulted in some tangible benefits to the area - and a long list of promises that remain unfulfilled.

"I was around in 1965, and you had the same kind of momentum in the first five years. And then all those institutions fell by the wayside," said Los Angeles County Supervisor Yvonne Brathwaite Burke, whose district encompasses most of South Central.

"You can't let those institutions be temporary and go by the wayside, you have to make sure they continue."