Posted: October 22nd, 2007

Parks Department Has Collected $120 Million in Quimby Fees, But Lacks Capability to Manage Program

by Anna Scott

The city Department of Recreation and Parks has acknowledged that it has no effective system for tracking or spending funds for park projects generated through special assessments paid by developers. This comes despite the fact that the department has collected more than $120 million in the fees known as Quimby funds since 2002.

The fees are supposed to be used for park creation and improvement efforts within two miles of where they are collected. Area developers have expressed outrage recently over what they charge has been a lack of production despite the accumulation of millions of dollars of Quimby fees in Downtown Los Angeles.

Recreation and Parks officials, meanwhile, say there are plans to purchase two small pieces of land for new Downtown-area parks.

Developers generally pay $3,000 to $9,000 for each unit of housing they create. Of the $120 million collected, according to the department, nearly $77.5 million remains un-allocated.

The admission that Recreation and Parks lacks efficient management of its Quimby funds came in an Oct. 12 letter from the department’s general manager, Jon Kirk Mukri, to Mayor Antonio Villaraigosa.

“The Department has no single database that gives a true and real-time picture of how much in Quimby fees have been collected; what projects Quimby is funding; what projects are contemplated for Quimby fees; and, an accurate accounting of any unobligated balance of Quimby fees,” the letter read in part.

Recreation and Parks officials were scheduled to address the matter before a city panel last Wednesday, but the item was delayed until Nov. 11. Ninth District City Councilwoman Jan Perry took up the issue after an increase in Quimby fees for some adaptive reuse, live-work developers last month raised questions as to where the fees collected in the area have gone.

“I want to see specifics,” Perry said last week. “I want to see how much has been earmarked, how much has been spent, and where it has been spent.”

The Numbers

According to a financial overview of the Quimby program provided to Los Angeles Downtown News last week by the Recreation and Parks Department, nearly $15.9 million has been collected in the Ninth District, which contains much of Downtown, since around 2002 (less than $750,000 was collected in prior years). Of that, $3.7 million has yet to be allocated for projects.

Mike Schull, superintendent of the Recreation and Parks Department’s Planning and Land Use Division, said the department is pursuing spending $7 million to acquire two parcels of land Downtown for new parks: an approximately 1.3-acre plot at 410 Center St. (near where the 101 Freeway meets the L.A. River) and a second parcel, less than one acre, near Third and Rose streets in the Arts District.

“That’s almost half the money collected in Downtown that we’re working on in acquisition,” said Shull. “These projects don’t happen overnight.”

Shull said Quimby funds have been spent on capital improvements at parks near the Ross Snyder Recreation Center, the Trinity Recreation Center, Central Recreation Center and Gilbert Lindsay Community Center. While those are in the Ninth District, they are in South L.A. or otherwise outside the core of Downtown.

“Projects are underway,” said Shull. But most of the funds collected in the Downtown area, he pointed out, “were collected in the last year and a half to two years. Just because the money hasn’t been spent yet doesn’t mean there isn’t a plan to spend it.”

Data provided by the Recreation and Parks department reported citywide fiscal year 2003-2004 Quimby revenue at just under $10 million. In 2005-2006, that figure had skyrocketed to nearly $44 million.

The sudden boom, according to the Oct. 12 letter, has overwhelmed Recreation and Parks’ accounting and tracking systems. Challenges in allocating the funds, said the letter, were compounded by a “lack of a comprehensive plan to effectively use” Quimby funds in areas with the greatest population growth, and an “outdated” local Quimby ordinance.

The department is working to develop a public database that will detail where Quimby fees have been collected. It is expected to be complete by next spring.

Although Quimby funds must be spent within two miles of where they are collected, Recreation and Parks hopes to see that limit expanded, Shull said, adding that land in Downtown is expensive and in short supply. He also said the department plans to survey Angelenos to learn how far they would travel to visit a park. The information will be incorporated into a proposal for amending the city’s municipal code and public recreation plan to make Quimby funds more widely applicable.

The idea of loosening the two-mile requirement rankles some.

“All that means is Downtown will without a doubt get screwed,” said Carol Schatz, president and CEO of the Central City Association. “The Downtown community will not tolerate having generated a good portion of these fees and then have them go toward other parts of the city.”

Others think the idea has potential. Mia Lehrer, a landscape architect who has worked on city park projects, including a study of how to use Quimby funds from the Staples Center, said the proposal, along with the recent Quimby fee hike, could be the only way to significantly increase parkland around Downtown.

“Land is very expensive and not very available,” said Lehrer. “I say, raise the Quimby fees and really create a comprehensive plan that serves the city’s core, and extend the net beyond two miles so it can include the L.A. River.”

Nonetheless, Lehrer said, during the Staples Center study, “One of the things we did uncover was how many under-utilized alleys and parking lots there are Downtown that could be pocket parks.”

Slow to Act
While the Recreation and Parks Department said it is seeking creative ways to leverage Quimby funds Downtown, others accuse the department of dragging its feet.Tom Cody, principal of South Park developer the South Group, said his company three years ago offered to turn a nearly half-acre piece of property surrounded by its Luma, Elleven and Evo buildings into a public park. As part of the plan, Cody said, Recreation and Parks agreed to look into acquiring a small piece of adjacent land at 11th and Hope streets to create “a through-block park” bounded by 11th, 12th and Hope streets and Grand Avenue.So far, Cody said, Recreation and Parks has taken no action. Meanwhile, Cody estimated South Group has paid just under $2 million in Quimby fees.

“Our hope is that Recreation and Parks can use those fees to acquire the land. I don’t think there’s any initiative there. We’ve reached our saturation point. In the next 60 days, this deal either gets done, or it never gets done, ever.”

Recreation and Parks’ director of real estate, Cid Macaraeg, said last week that the department is still working with the South Group and looking into purchasing the land.

However, said Macaraeg, the price of the approximately one-sixth-of-an acre property, which currently holds a vacant building, exceeds what the South Group has paid in Quimby funds as well as the $3 million in unallocated Ninth District money.

If new residential development continues at a rapid pace Downtown, Recreation and Parks could increasingly have to collaborate with developers to bring in new park projects. But the availability of land, according to some experts, is not the neighborhood’s primary challenge.

“Land is recyclable,” said Dave Gay, a city planner. “It isn’t a matter of running out of land. It’s the time gap that’s a concern. The longer you hold on to Quimby fees, the less valuable the money becomes. It’s less bang for the buck.”

Contact Anna Scott at anna@downtownnews.com.