BUSINESS TAX REFORM STALLS IN SERIES OF DELAYS PARKS CALLS FOR IMPACT STUDY.

Byline: James Nash Staff Writer

Los Angeles business leaders clamored Friday for long-promised relief from city taxes but officials said they still don't know if the city can afford to cut their taxes, casting doubt on an Oct. 31 deadline for adopting a package of reforms.

The delays - and the prospect for months or even years of stalling on lowering the tax - angered business leaders and City Councilwoman Wendy Greuel, who said the inaction was fueling an exodus of business from Los Angeles.

``We can't keep putting it off,'' said J. Richard Leyner, a commercial real-estate broker who heads the Encino Neighborhood Council. ``We need the new businesses. We need the jobs.''

Officials promised tax relief for business a decade ago and a committee of business leaders has studied ways to simplify and lower the business tax since 1999 while city officials conducted their own studies.

Los Angeles' tax is higher than that of neighboring cities - some of which levy no business tax at all - and is considered a key factor in corporate decisions to leave Los Angeles or not move to the city.

On Friday, members of the city's ad hoc committee on business tax reform did not rule out further study of reform proposals but stopped short of ordering a new study.

Some city officials say the municipal budget must be insulated from revenue losses caused by lowering the tax, which accounts for about 7 percent of city revenues.

Greuel and Councilman Eric Garcetti have proposed cutting the tax by 25 percent over five years, and by another 25 percent after that if city revenues recover. A committee of business leaders has proposed reducing the tax by 15 percent over five years, with another 15 percent cut if revenues recover from the initial reduction.

Councilman Bernard C. Parks, who chairs the budget committee, said he couldn't support any proposal to reduce the tax without a study of the impact on city revenues.

``I believe that everybody wants to do something,'' Parks said. ``The issue is, we want to make sure that something isn't more harmful than what we have. We really have to know what the outcome is.''

Greuel said the outcome is self-evident: lower taxes encouraging business to come to Los Angeles or expand, which in turn generates more tax revenue.

``We don't need another study to review the impact on the city,'' Greuel said. ``I've had enough. The time is now for business tax reform.''

The city paid a consultant $420,000 to suggest reforms to the business tax that would not depress revenues. The consultant's recommendation drew widespread criticism from business executives who said it would not bring overall tax relief.

On Friday, about 20 business leaders, primarily from the San Fernando Valley, sported green stickers at the committee meeting that read, ``Reform by Oct. 31!'' The Greater Los Angeles Chamber of Commerce and the Valley Industry and Commerce Association set the deadline to spur city leaders to make reforms after years of on-again, off-again debate.

Martin Cooper, the chairman of VICA, said business leaders are anxious for concrete reforms, not more debate.

``When I hear someone say they're committed to a process, I think that's wonderful, but it doesn't have a time imperative,'' Cooper said. ``There have been years of talk, there have been years of study.''

James Nash, [phone]

james.nash(at)dailynews.com