Harold & Belle’s Has a Friend in Herb

But Herb is not just any old customer of this gumbo and crawfish etouffee paradise that was started in 1969 by New Orleans transplants, Harold and Belle Legaux.  Rather, he is a major benefactor, having arranged a $2,639,000 Section 108 Loan from the United States Department of Housing and Urban Development designed to create jobs in areas of the City with “disproportionately high levels of unemployment.” 

However, in this case, only 17% of the loan ($446,000) will be invested in the business and for the creation of jobs, while 83% of the loan (almost $2.2 million) will be used to finance a leveraged buyout of the business by Harold and Belle’s grandson (Ryan Legaux) from his mother and his deceased father’s business partner. 

While this is a great deal for Ryan, it is just another example of the sleazy deals that permeate City Hall where political connections (and no doubt some campaign cash) trump solid financial analysis and good business judgment.  

According to Steve Lopez of The Los Angeles Times, this deal was turned down by three commercial banks and the SBA (Small Business Administration).  

So why are the taxpayers banking this very risky deal, especially given that only 17% of the dough is being invested in the business? 

There is no doubt that Herb and his minions will be able to wax eloquently about the merits of this deal, how it creates and saves full time, living wage jobs, how the taxpayers will not have any risk because of all the valuable collateral, and how dare anybody question their motives, judgment, and integrity.  

But this is not the only stinker in Herb’s kingdom.  

In February, just two weeks before the March election, the City Council approved a Wesson sponsored deal where the City would lease a surface parking lot (the estimated value is between $5 and $10 million) on the southwest corner of Vermont and Sixth to the Korean American Museum for $1 a year for the next 50 years.  This backroom deal that was rammed through the City Council in eight days without any hearings was concocted without the benefit of an independent appraisal and was designed to placate (buyoff) members of the Korean community who were screwed by Herb in the redistricting process. 

Needless to say, there are many more sleazy, less than transparent deals throughout the City, whether they are in Hollywood, Woodland Hills, the Westside, the Eastside, the Harbor, or Downtown.  But when all these dirty deals covering the 15 Council Districts are aggregated, we are talking real dough that our cash strapped City can ill afford to lose.  Just look at our streets and sidewalks. 

Now is the time for the City Council and our new mayor to clean up the City’s act and begin to earn the trust and confidence of the City’s alienated voters, especially since the City is actively hatching a plan to raise our taxes by over $200 million to repair our streets.  And there is no better place to begin that Council District 10, the home of City Council President Herb Wesson. 

So Herb, now that the skies are blue, it is time to let the sun shine on CD 10. No more shady deals. 

(Note: To help celebrate the new ownership and the drawdown of a significant portion of the Section 108 Loan, on Saturday, July 6, Harold & Belle’s Creole Restaurant will host its Annual Block Party between 12 and 6.  Tickets are $30 for all you can eat, or $25 on line.)

(Jack Humphreville writes LA Watchdog for CityWatch. He is the President of the DWP Advocacy Committee,  the Ratepayer Advocate for the Greater Wilshire Neighborhood Council, and a Neighborhood Council Budget Advocate. Humphreville is the publisher of the Recycler Classifieds -- www.recycler.com. He can be reached at:  [email protected]. Hear Jack every Tuesday morning at 6:20 on McIntyre in the Morning, KABC Radio 790.) 
-cw  

CityWatch

Vol 11 Issue 54

Pub: July 5, 2013