DOWNTOWN : Two Areas Interested in Self-Taxation

Self-taxation is catching on Downtown.

Little Tokyo and Central City East are considering forming special tax assessment districts to fight urban grime and slow sales.

If the two campaigns are successful, Downtown will be home to four such districts. Their popularity is increasing as the city and county struggle to provide maintenance and security services.

The districts allow the annual collection of a special tax on businesses or property owners. That money, managed by district member representatives, can then be used for various improvements, including increased security, maintenance, landscaping and marketing.

“I think it’s a very village-oriented, democratic way to go,” said Bill Watanabe, head of the Little Tokyo committee proposing the district. “It’s true taxation with full representation.”

In Central City East, a light industrial and manufacturing area east of Downtown, organizers of a proposed tax district said they will spend the next few months gathering signatures from property owners. Organizers must obtain at least 51% approval before the proposal goes before the Los Angeles City Council, which must approve the district.

“A lot of people feel what they are paying for in their property taxes aren’t getting them the services they need,” said Tracey Lovejoy, director of the Central City East Assn., which is leading the drive for a district.

Such special tax districts have been used in Philadelphia and New York, where formerly rundown business areas were transformed into vibrant trade zones. Closer to home, business owners cite the success of Santa Monica’s Third Street Promenade, a retail and entertainment district that uses its self-imposed taxes for extra police and trash pickup.

In Downtown, a stretch of Broadway between 2nd and 9th streets became the first special tax district in Los Angeles nearly two years ago. Organizers said the $420,000 raised annually from business owners was necessary to keep the retail district competitive with malls, which can offer private security and extra maintenance.

Last month, the City Council approved the creation of a business district that would tax property owners in the garment district. Organizers expect to raise $2 million a year to be used for private security, trash removal and marketing.

The 56-block garment district is bounded by 7th Street, the Santa Monica Freeway, Main Street and San Pedro Street and includes about 1,000 businesses.

Taxes from the garment district, like the district proposed for Central City East, will be collected from property owners through additional assessments to property bills.

In Little Tokyo, district proponents said the assessment is needed to pay for street cleaning and security made necessary by homeless people who sleep on the streets. After a year of efforts to inform the estimated 600 business owners about the district, organizers are preparing an informational brochure in Japanese and English.

The district’s boundaries would be Alameda, Los Angeles, Temple and 3rd streets. Organizers estimate businesses would pay an average of $125 a year.