The Race is On.

CANDIDATES EXPLAIN POSITIONS ON KEY ECONOMIC ISSUES FACING LOS ANGELES

On April 10, Los Angeles residents will go to the polls in the Los Angeles City Primary Nominating Election to begin the process of selecting the next mayor - a significant turning point in the future direction of the City of Angels. After eight years and two terms of Mayor Richard Riordan, term limits mandate that a new mayor must take office.

The $153,285-a-year job is no figurehead position. The mayor essentially serves as the city's chief executive, submitting the city budget to the city council, exercising authority over all city departments and appointing their leaders, as well as working with the city council to pass legislation.

The Los Angeles mayoral election is not only important for the city and its nearly four million residents, it is of keen interest to the entire region. The city's massive economy, its policies and population impact everything around it, making the mayor of Los Angeles one of the state's most influential leaders and a national political figure. The mayor also serves as the unofficial ambassador of Los Angeles to the rest of the world - constantly working to promote a positive image of the city and region.

To help differentiate between the candidates, the Chamber has dedicated this issue to communicating their positions on several issues paramount to the city's economic health.

Using the amount of campaign funds raised as the criterion, we asked the top six mayoral candidates (listed at right) several questions. Their responses to the long-answer questions are printed on the following pages. Short answers are plotted on an easy-to-read table on page 5.

The primary election on April 10 will narrow the field of mayoral candidates down to the top two candidates with the most votes, who will then run against each other in the Los Angeles City General Election on June 5.

Candidates Queried

Xavier Becerra

CURRENT POSITION: U.S. Congressman, 30th District

SUPPORTERS: Los Angeles Councilman Nick Pacheco; U.S. Congresswoman Lucille Roybal Allard; Fermin Cuza, Sr. VP of Mattel, Inc.

Kathleen Connell

CURRENT POSITION: California State Controller

SUPPORTERS: Alan Casden; NWPC, WPC - Women's Community; Tom Barrack

James Hahn

CURRENT POSITION: Los Angeles City Attorney

SUPPORTERS: Irvin "Magic" Johnson; Bill Wardlaw, partner at investment banking firm Freeman Spogli and Company; Los Angeles City Councilman Alex Padilla

Steve Soboroff

CURRENT POSITION: Businessman, Los Angeles Recreation and Parks Commission President

SUPPORTERS: Mayor Richard Riordan; actor Kirk Douglas; community activist "Sweet" Alice Harris

Antonio Villaraigosa

CURRENT POSITION: Candidate for Mayor of Los Angeles

SUPPORTERS: SunAmerica founder Eli Broad; U.S. Sen. Barbara Boxer; Los Angeles County Sheriff Lee Baca

Joel Wachs

CURRENT POSITION: Los Angeles City Councilman

SUPPORTERS: I have a wide range of supporters and value all of them equally.

Candidates were asked to submit their current position and to name three supporters of their choice.

Q: In light of the fact that many corporate headquarters have left Los Angeles in recent years, what are your strategies for attracting, sustaining and building new business?

Becerra: We need to offer companies more than tax incentives. We need to offer them a city with a highly skilled workforce and the kind of basic infrastructure that will make Los Angeles an attractive place to relocate. We must undertake an essential shift in the way our city plans, develops and governs. Instead of developing on the periphery and outside of the city, we need to focus inward and aggressively create a business-friendly environment that includes livable communities and a strong, educated workforce.

As mayor, I will take the leadership role to work with the City Council and community stakeholders (such as the Los Angeles Area Chamber of Commerce) to reorganize and consolidate the different economic development functions the city currently undertakes within agencies such as the Community Development Department, the Community Redevelopment Agency and even the Mayor's Office of Economic Development. Once an Economic Development Department is established, I will spearhead a national search process and initiate a local stakeholder selection committee to bring forward an aggressive economic development chief. We must also reform the city's tax code. Los Angeles can stimulate the local economy and attract businesses by making the tax code fairer and more efficient. My experience and connections as a member of the House Ways and Means Committee (which is responsible for tax and trade policy) will enable me to craft solutions that benefit both Los Angeles' businesses and residents.

Los Angeles must take advantage of every opportunity presented by our position on the Pacific Rim to form economic partnerships with the emerging democracies of Asia and Latin America. These are the broad and global possibilities ahead for our city.

In order to deliver on the promise of a strong and vibrant Los Angeles that is the defining city of the twenty-first century, we must start with a strong foundation - our neighborhoods. Whether it is Central City, Echo Park, Brentwood, or San Pedro, strong neighborhoods will mean a strong Los Angeles. As mayor, I will fight to provide the schools, roads, affordable housing, public safety, and targeted economic development that neighborhoods need to become dynamic, livable communities.

Connell: Los Angeles is a dynamic city that should become a global capital of the new economy. It is hindered in achieving this vision by a dysfunctional and overburdening tax system; by an antiquated system of permits and regulations; by a reluctance to aggressively pursue land assembly and condemnation practices; and by lack of a coherent financing incentive plan for emerging enterprises.

The tax system of Los Angeles simply fails to be either equitable or efficient. Over 40 percent of all businesses in Los Angeles are "deadbeat" businesses that fail to pay their share of taxes. I have sponsored - and will continue to do so - legislation that will enable the Franchise Tax Board, which I chair, to disclose business tax rules to the City of Los Angeles so they may effectively enforce collection of tax. If all taxes were collected and with the goal of revenue neutrality, the overall tax rate could be lowered, assisting marginal business and making L.A. a more attractive business location. As mayor I will insist all taxes are collected, enabling a tax reduction opportunity.

As mayor, I will be appointing an ombudsman to advocate changes in L.A.'s regulatory system to better expedite business activity. In this regard, I will establish a one-stop processing center for the application of construction permits and the business ombudsman office will assist in expediting all such applications through appropriate boards and commissions. It will be necessary to define a comprehensive land acquisition and condemnation policy to assure the assemblage of large parcels of land for the purposes of locating campuses for new economy businesses. Los Angeles is the natural location for the biomedical industry, the expansion of Silicon Valley, and the multimedia components of the entertainment industry and international trade.

I intend as mayor to conduct performance audits of the major agencies to ensure waste is cut, fraud is identified and savings are transferred to neighborhood services. Enhancement of neighborhood services will enhance the quality of life throughout L.A., making the city attractive to future employers.

Hahn: Continuing to foster this city's economic growth and bringing new jobs to the region will be a major priority for me as mayor. The first step is to improve infrastructure that will make Los Angeles an attractive place for businesses to locate. Businesses have many of the same needs as the city's residents. That means that we need good schools, a safe city, and a quality transportation system - all issues that will be a top priority for me when I am mayor.

Next, we need to address our tax system. Though large business headquarters are important, the Los Angeles market is dominated by small and medium-sized businesses. The city must work to foster the development and growth of the businesses that provide the majority of our jobs, which will include expanding the Mayor's Business Team to help new businesses as well as existing businesses that want to expand. I would eliminate the business tax on start-up businesses for the first two years. For all businesses, I would eliminate multiple tax categories that would ease the tax burden by millions of dollars citywide.

Also, I will see to it that Los Angeles does a better job of supporting and facilitating private sector development of a competitive telecommunications infrastructure to meet the demands of businesses and residents. This includes seeing that the city must make better use of its own telecommunications assets, such as the thousands of miles of fiber-optic cables the city owns but currently puts to poor use.

Soboroff: It is essential that the next mayor of Los Angeles keep our economy moving forward. Over the past 30 years, I have built a successful business in real estate here in Los Angeles. I know what it takes to meet a payroll, make deadlines and meet goals. I will:

* Make Los Angeles more business-friendly. We must provide a system of competitive and predictable entitlement processes, fees and taxes and continue the work of Progress L.A..

* Recruit new business to our area. I will expand the Mayor's Business Team and actively recruit high-tech firms.

* Make Los Angeles the safest big city in America by increasing the number of police on our streets and fighting gang activity.

* Dramatically improve public education by breaking up the LAUSD and creating neighborhood schools. We must begin providing quality public education so our children can participate in the growth of L.A.'s economy.

* Give business a seat at the table. I strongly believe that organizations like the Los Angeles Area Chamber of Commerce, the Economic Alliance of San Fernando Valley, the Convention & Visitors Bureau and the Central City Association must have access to and communication with the mayor's office.

Villaraigosa: Most of the new jobs created in the boom of recent years came via small businesses. I support providing improved technical aid and credit to small business to foster start-ups and growth.

The city's business tax structure remains in need of reform. Categories should be consolidated and rates reduced. I continue to support state legislation to aid the city in improving its collection rate on business taxes. That way, a rate reduction will have minimal effect on overall revenues and the system will be fair to all businesses.

The city's economic development efforts should be consolidated and coordinated and a coherent strategy developed. The Mayor's Business Team should place more focus on bringing high-wage jobs and growth companies to the city. Land use planning functions should be more strategic to foster economic development where it's needed. A "Mayor's Council of Economic Advisors" should become part of the team, making the city's effort more responsive to changing economic conditions.

Attracting business to Los Angeles is also a quality of life and cost of living issue. Improving the environment, providing more parks, improving transit to relieve congestion, and addressing the housing shortage will help us be a more attractive location for businesses.

Wachs: The role of the city should be to do the best job it can to provide an environment that is attractive to businesses and their employees. It starts by running city government like a business. And it means a business-friendly city that is safe, clean and livable.

The city's top priority must be the retention of existing businesses and the attraction of new businesses, particularly those that provide quality jobs. To accomplish this, I propose a comprehensive five-year economic development plan that is the product of all stakeholders, and not just one passed down from City Hall.

I am also concerned about committing huge amounts of public funds to businesses that have glitzy appeal but little real economic benefit. Instead, we need to consult with respected economists and renowned financial advisers, and spend our resources on what's economically right rather than what's politically right.

It is also critically important that the city adopt the recommendations of the Business Tax Advisory Committee, and invest at least 75 percent of the savings produced by Assembly Bill 63 in business tax reform and simplification.

Q: Throughout the state, businesses are being hit by huge increases in utility costs, resulting in bankruptcies and closures in some cases. What steps would you take to ensure L.A. businesses would be protected?

Becerra: Thankfully, the Department of Water and Power currently shields Los Angeles residents and businesses from skyrocketing energy rates. However, in our global economy we cannot isolate ourselves from the ripple effect of California's energy crisis. Los Angeles' city commerce is just as dependent on the municipalities around us, as they are on us. We should keep our commitment to the policy of maintaining our cooperative energy arrangements with other state partners.

As mayor, my first priority concerning energy policy will be to maintain the strength and independence of the DWP. The aggressive campaign to eliminate the DWP's debt by 2003 will enhance its ability to keep utility costs down for businesses and households.

As someone with state and federal experience, I will utilize my relationships to advocate for a long-term statewide solution, which includes self-sufficiency for California and independence for the DWP.

Connell: We are in a perilous situation in regards to energy. Governor Davis has already indicated that it is a priority at the state level.

The new mayor will have to be a strong advocate for the continued independent operation of the DWP. My experience as State Controller and understanding of Sacramento will be invaluable in ensuring that Los Angeles is not subsidizing the unfortunate scarcity of energy to other areas of the state.

The DWP should have an opportunity to sell its energy resources at cost levels reflective of that enterprise's obligations to its investors and to the price concerns of Los Angeles residents.

I am concerned about restrictions on the sale of and/or operation of municipal utility districts. In L.A., we should be thankful and proud of how the DWP has managed its resources and provided services for city customers.

Hahn: The DWP is independent of the new deregulated system that was established. The policy should be to keep the DWP in this position for as long as possible, which it has elected to do. But soon, the DWP's option will end. It should not be required to participate in the state program until the regulation of the market has been amended so consumers are not so vulnerable.

The mayor should take a lead in protecting the DWP's independence. With respect to Los Angeles County, the mayor and city council should support all efforts to rein in the excessive rates charged by out-of-state suppliers. While the free market should be permitted to operate whenever possible, we do not have a free market in the field of electricity. Supply needs to be increased, conservation encouraged and, until the market evens out, caps should be placed on prices charged by out-of-state suppliers.

Soboroff: I will not allow Los Angeles to be pulled into the current deregulation structure. The guidelines of this structure are seriously flawed and have led to massive cost increases and rolling blackouts.

I will continue to empower DWP General Manager Dave Freeman and mandate that this department resist deregulation. The current federal modifications do not do enough to protect the citizens and businesses of Los Angeles.

Villaraigosa: Los Angeles businesses currently are protected by the Department of Water and Power's nonparticipation in deregulation. Most significantly, the DWP has not divested itself of its power plants. Consequently, the city has had enough power to serve its businesses' and residents' needs with a surplus left over to sell to other users at a profit to the city. This basic arrangement should continue.

Now that the state is looking at restructuring the industry to deal with the statewide shortages and cost increases, Los Angeles should ensure that any cooperative arrangements to team the DWP with the state and others do not jeopardize our ability to protect DWP ratepayers. Electricity users may face additional increases based on rising natural gas prices, but the DWP should seek its own sources of gas and increase efforts to develop solar and other power sources not so dependent on the price of fuel.

Los Angeles has fared well so far in the recent crisis, but we are in a constantly changing environment and need to retain the flexibility to respond to those changes. I will work with the governor and legislature to make sure we can.

Wachs: Maybe it's the state's disastrous electrical power deregulation plan that will drive businesses to Los Angeles. While the state legislature was busy designing the utility industry's version of the Hindenberg, I was fighting hard to force the Department of Water and Power to streamline its operation and prepare for marketplace competition.

For years, I was loudly criticized for arguing that the DWP was bloated with overpaid and underworked engineers. Only when the threat of deregulation became real did the city council finally agree to commission that first independent outside audit of the department. We brought in the Barrington-Wellesley Group and benchmarked the DWP against public and private utilities, and as a result we cut nearly 2,000 employees and a quarter of a billion dollars from its budget.

Q: Recognizing that projections indicate that passenger traffic will increase from 60 million to 90 million by 2015, what is your position on the expansion and modernization of LAX?

Becerra: Air traffic is a regional issue, which necessitates a regional solution. Expanding the region's air traffic capacity should not fall only on the environment and neighborhoods surrounding LAX. As mayor, I would convene a summit with the mayors of our neighboring cities to collaborate and develop solutions that ensure other areas carry their fair weight. If Southern California is to maintain our position as the hub of international commerce and all surrounding areas are to benefit from this trade potential, we must engage in this kind of strategic regional partnership.

Connell: Airports are key for doing business in today's global economy. The Los Angeles region clearly needs additional capacity. However, such capacity is a regional responsibility and must include discussions with Long Beach, Orange County and Burbank. In addition, as mayor, I would consider the placement of an airport in Palmdale/Lancaster.

I support modified plans to modernize LAX in regards to creating a linkage between the airport and the Metro rail system, and I will review other proposals with the objective of not creating additional congestion on the 405 freeway or other neighboring streets.

Hahn: Because the current airport was designed for only 40 million annual passengers, I support the modernization efforts at LAX. However, it is the first step in what needs to be a significant regional effort to address the increase in air traffic coming into the region. First, efforts must be made to listen to the concerns of the residents around LAX and that is why I have supported a 180-day public hearing process to get public input on the master plan. One key component of any plan must be reducing traffic in and around LAX, not only to ease congestion on our roads and improve air quality. That is why any plan must include the development of a ring road to help get traffic off the 405, the extension of the 105 into the airport, and the extension of the Green Line into the airport. I will aggressively seek federal and state funds to see that these improvements occur.

We must also better coordinate the region's mass transit systems, making it more convenient for people to take mass transit to the airport and not their cars. But LAX cannot bear the entire burden. Capacity at other airports must be increased, and the air traffic burden must be addressed regionally.

Soboroff: LAX will get busier (through efficiencies and larger planes) whether or not any further modernization is approved. I believe we must take a long-range view of this issue. I will:

* Encourage a regional approach to air traffic (both passenger and cargo) issues. We must look at ways to promote more air traffic at other area airports.

* Support modernization of LAX, which will mitigate existing problems with traffic, air and noise.

Villaraigosa: I support modernization at LAX, but not the full expansion proposed. However, history shows us that "operations creep" will cause activity to increase even if facilities aren't expanded to accommodate growth. The extent of that increase will be governed by air traffic safety and ground access limitations. Even with some or all of the improvements contemplated in the LAX 2020 Master Plan, the capacity is not elastic despite the projections. There's not enough room in the sky and not enough room on the ground.

That's why it is imperative that Los Angeles World Airports (LAWA) undertake a regional planning effort that makes better use of, and incentivizes, growth at Ontario and Palmdale, and encourages appropriate activity increases at March, Norton, Burbank, and other airports in the region. The Southern California Association of Governments (SCAG) recently reported that L.A. and the region will benefit just as much from more dispersed aviation activity, and this will mitigate the physical limitations at LAX.

LAWA should deal with ground access issues at LAX before it tries to expand the facility. Failure to do so in the '80s is what brought LAX to its current state of dysfunction and popular opposition to the Master Plan.

Wachs: We need a regional approach to deal with the overwhelming air traffic demand for Southern California. LAX alone can not carry the entire demand for the region. Further, LAX was recently criticized by J.D. Power & Associates as being one of the worst airports in the nation from a customer service standpoint. Therefore, its first priority should be to improve its current operation.

Secondly, the Los Angeles World Airports must also focus more on expansion at Palmdale and Ontario, and Orange County must also assume its fair share. With 17,750 acres, Palmdale is five times the size of LAX, yet its operations are only 1 percent of that at LAX. Incentives, such as lower landing fees and less expensive ground transportation charges, should be provided to airlines that use these other airports.

Finally, high-speed rail linking downtown L.A. to Palmdale and San Francisco must be a transportation priority. At the going trends, over 60 percent of air operations out of LAX and over 95 percent at Burbank will continue to be "commuter" flights to places like the Bay Area, Las Vegas and Phoenix. A high-speed train could easily get a person from downtown L.A. to downtown San Francisco cheaper, quicker, quieter and with less air pollution. Further, such a program will make room to increase operations of international flights, particularly from the Pacific Rim.

                      Candidate Short Answer Responses
Question               Becerra     Connell      Hahn       Soboroff

Do you support or      Support     Support     Support     Support
oppose continued
investment in light
rail infrastructure in
Los Angeles?
Do you support or      Support [*] Support [*] Support [*] Support [*]
oppose phase two of
Staples Center?
Do you support or       Oppose      Oppose      Oppose      Oppose
oppose secession
movements in the
San Fernando Valley,
the Harbor area
and Hollywood?
Question               Villaraigosa   Wachs
Do you support or        Support     Support
oppose continued
investment in light
rail infrastructure in
Los Angeles?
Do you support or        Support [*] Support [*]
oppose phase two of
Staples Center?
Do you support or         Oppose      Oppose
oppose secession
movements in the
San Fernando Valley,
the Harbor area
and Hollywood?
(*.)As long as public and/or city funds are not used.

Don't Forget to Vote

Los Angeles City Primary -- April 10, 2001

Los Angeles General Election -- June 5, 2001

As the November presidential election proved, every vote counts. Be sure to study your ballot, locate your polling place and cast your vote on each election day. Encourage your employees to do the same. In addition to the Los Angeles City Primary Nominating Election, which includes the mayoral race and contest for city attorney, other Los Angeles races on April 10 include:

* 32nd Congressional District Special Primary (consolidated with Los Angeles City Primary Nominating Election)

* Los Angeles Unified School District

* Los Angeles Community College District

On June 5, the Los Angeles City General Election will decide who will be Mayor of Los Angeles, as well as who will take office in the other areas described above.

Voter Registration Deadline

March 26 for April 10 Los Angeles City Primary

May 21 for June 5 Los Angeles City General Election

Business Community Hosts Mayoral Candidates Forum

More than 600 people attended a February luncheon with four of the six leading candidates for mayor of Los Angeles. The candidates, who included Kathleen Connell, Steve Soboroff, Antonio Villaraigosa and Joel Wachs, fielded questions concerning affordable housing, expansion of the Los Angeles International Airport, the Los Angeles Unified School District, the Los Angeles Police Department and secession.

Several media outlets were on hand as candidates responded to inquiries from representatives from the Chamber and the other event sponsors, including the Central City Association, Commercial Real Estate Women, L.A. Headquarters Association, L.A. Junior Chamber of Commerce, the Latin Business Association and the Urban Land Institute.

Candidate Picks for Best Picture 2000

For a change of pace, before the Oscar nominations were announced, we asked each candidate what movie would be their choice to win the Oscar for Best Picture of 2000.

Xavier Becerra -- "The Contender"

Kathleen Connell -- "Chocolat"

James Hahn -- "Gladiator"

Steve Soboroff -- "Finding Forrester"

Antonio Villaraigosa -- "Pay it Forward"

Joel Wachs -- "Erin Brockovich"