Caruso Talks Fire Rebuilding, Political Run, Measure ULA

Pacific Palisades residents sought advice and clarity from Rick Caruso during an hour-long community rebuild meeting Monday evening.

While the developer offered crisp critiques of what he painted to be the city of Los Angeles’ bureaucratic inertia, whether Caruso makes another bid for political office remains murky.

“I’m not going to give any announcement until the end of summer because I don’t know yet,” Caruso said during the public Zoom meeting. “Do I love public service? Yes. I obviously wanted to be mayor once and I love helping the city. I love the city. Simple as that and I love the state, and I think we should be the best city in the best state. So I’m looking at a lot of different options, but right now my focus is [non-profit] Steadfast [LA] and that’s what I’m going to focus on. And probably sometime after summer, I’ll make a decision on political office, and we’ll go from there.”

The statements are largely in line with how Caruso’s addressed mounting speculation on whether there could be a sequel to his 2022 attempt running for mayor of Los Angeles, or perhaps the larger stage of California governor. He’s been careful not to let talk of any bid for office overshadow the massive, multi-year rebuilding process left by the devastation of January’s Palisades and Eaton fires.

Instead, he’s been pushing for public-private partnerships through Steadfast LA to expedite building efforts, most notably striking one such deal announced last week to rebuild the Palisades Recreation Center. The partnership is between the City of Los Angeles, LA Strong Sports and Steadfast LA. The latter two groups will handle raising all of the money for the park, but will incorporate community input on how it’s rebuilt.

“This is too big for the government alone to handle. It’s got to be a series of public-private partnerships,” Caruso said. “What we did at the park needs to be duplicated 100 times-plus.”

The park is expected to be completed at a cost of $25 million to $30 million. Caruso cited the 16-month construction timeline for when his upscale Palisades Village retail center was first built as an example of efficiency before confidently stating his estimate for getting the park done within a year.

“This is one of the reasons we don’t want it in the hands of the city,” Caruso said. “The city was projecting it was going to take four years to just rebuild what was already there.”

To that point, Caruso urged those in attendance to hold elected officials accountable and “keep the pressure on them” if they want their communities rebuilt faster.

“We’ve got to get a culture in the city changed, to team up with private sector businesses,” Caruso said. “What we’re trying to do is start this flywheel that just creates such motion … that things start happening very quickly. That’s the solution to this.”

Talking permit fees, Measure ULA

The developer held court, along with Caruso’s Noah Emanuel and Steadfast LA’s Nick Geller, during Monday’s weekly meeting of the 1 Pali resource group. The 1 Pali organization is led by Amalfi Estates founder Anthony Marguleas and Ben Perlman, an adviser to family offices and head of strategy at retailer Ocean State Job Lot.

The trio of guest speakers offered their thoughts and updates to the over 800 in attendance. Conversation ranged from the Palisades Village reopening to the push to temporarily pause Measure ULA.

On Palisades Village, the shopping center is expected to reopen early next year, with some new tenants. Caruso declined to offer hints on what those new businesses might be.

In the case of permitting fees for rebuilding in fire-impacted areas, Caruso said they should be waived. He called the decision a “no-brainer” and something he and his group continue to “demand” from the city.

“I’m frankly amazed that they just haven’t [waived them],” he said of permit fees. “It’s the easiest thing in the world to do.”

Something not so easy, but another action item taken up by Caruso and his team is the temporary stop of Measure ULA in fire-damaged zones.

Such an action on the tiered property tax was something City of Los Angeles Mayor Karen Bass said she was looking into when pressed earlier this year during a media event. Bass’ office didn’t respond to Real Tactics Pro’s request for comment.

Voters in 2022 passed Measure ULA, which was dubbed the “mansion tax,” although it applies to commercial and residential deals. New thresholds, which are adjusted annually, will go into effect June 30 and apply a 4 percent tax on transactions starting at $5.3 million and 5.5 percent on those of $10.6 million or more.

Postponing the tax is one of Caruso’s top priorities, he said.

“On a … broader level, what we do know is ULA has been extremely detrimental to the city of Los Angeles,” he said. “It has actually caused a reduction in revenue because less people want to invest in Los Angeles because they have to build in the cost of ULA into their construction costs.”

Geller said Steadfast has been reaching out to law firms, including O’Melveny & Myers, to evaluate what guidance can be provided to the city council on ULA.

“We recognize that unilaterally, the mayor [and] council can’t probably do anything that repeals what was a voter referendum,” Geller said during the meeting, but added conversations are being had daily with lawyers on “a path to relief.”