Los Angeles County officials are grappling with unexpected financial burdens following the purchase of the Gas Company Tower for $200 million, a figure that was positioned as a bargain amid declining office property values in the wake of the pandemic.
Nine months after the sale, Supervisor Janice Hahn, who voted against the acquisition, expressed her shock over additional costs emerging, particularly a $230-million contract for seismic upgrades to the tower, which is set to become the county’s new headquarters.
“I never heard that it would double the cost of the purchase,” Hahn commented, highlighting the fiscal concerns that have arisen since the acquisition.
In response to these worries, Supervisors Hilda Solis and Lindsey Horvath plan to introduce a motion aimed at halting all seismic work on the newly acquired building. Horvath expressed surprise at the prospect of ongoing work considering the county’s financial constraints, stating, “Given that we are in the budget constraints that we are in, I was surprised to know that that work was still being contemplated.”
The county’s financial outlook has become increasingly dire, with upcoming federal cuts predicted to force reductions in health services and the potential closure of a hospital. Chief Executive Officer Fesia Davenport provided a grim overview to the board, detailing the impending payments for a historic $4-billion sex abuse settlement and new labor contracts that could amount to an additional $2 billion in costs.
Prior to the purchase, county officials were presented with estimates about the expenses of upgrading the Gas Company Tower compared to retrofitting the Kenneth Hahn Hall of Administration, which many employees deem unsafe during a major earthquake.
Bringing the Hall of Administration up to earthquake standards could potentially cost around $700 million, while the costs associated with making the Gas Company Tower compliant were projected to be about $400 million, though the county’s current budget allocates less than that, with a bid of $234.5 million.
The Chief Executive Office outlined that the Gas Company Tower was viewed as a significantly better investment, with anticipated savings exceeding a billion dollars when evaluating other costs and deferred maintenance on the Hall.
Despite these arguments, Hahn remains unconvinced. “I think the bureaucrats had a plan and they made their numbers fit to sell this ill-conceived project,” she remarked, suggesting that some of her fellow supervisors are starting to question the wisdom of the deal.
Horvath, while still defending the initial purchase, expressed skepticism about the necessity of extra investment in seismic upgrades, noting, “If retrofitting is not needed, then I want to understand why we would [retrofit] at a time such as this, when we are making a very clear case about the difficult financial position we’re in.”
The Gas Company Tower includes a “steel moment frame” structure that has proven resilient; although buildings with this design sustained damage in the 1994 Northridge earthquake, they did not collapse. Lennie LaGuire, a spokesperson for the Chief Executive Office, indicated that the tower was already deemed safe, and the upgrades were being undertaken as a precautionary measure.
LaGuire stated, “The County is choosing to perform this work proactively with an eye to the future, to ensure that the building performs optimally in the decades ahead.” The defensive response comes amid ongoing labor negotiations where the building purchase became a contentious topic. Labor unions criticized the acquisition as an unnecessary expenditure while county leadership contended that it was a pragmatic cost-saving decision.
Tensions remain high, particularly among labor representatives who alleged they were uninformed about the true costs of the tower’s purchase. Richard Pippin, president of the sheriff’s deputies union, stated, “The priority should be those facilities the public relies upon for emergencies and daily needs, like sheriff’s stations, fire stations, medical facilities, etc.”
Pippin also critiqued the decision-making behind the acquisition, arguing that the motivations behind purchasing the building may have more to do with aesthetic desires than public service considerations: “Look, we get it — with the near doubling of the Board of Supervisors and an elected County Executive Officer, everyone wants an office with a better view, but is that what’s best for the public we serve?”
Alongside the motion to suspend seismic work, the supervisors are also requesting a report detailing the financing sources for the retrofit and clarifying which departments are set to occupy the tower.
The motion states, “The purpose of this acquisition was to realize substantial savings for the County of Los Angeles by consolidating operations and avoiding leased spaces. However, there has been little to no transparency into what progress, if any, the County has made in occupying spaces in the Gas Company Tower after eight months of ownership.”
The Chief Executive Office confirmed that some employees have already begun moving into the building, with the entire relocation process projected to span three years.
In related local news, Councilmember Imelda Padilla expressed concerns about President Donald Trump’s recent announcement regarding his involvement with a federal Olympic task force. Padilla characterized this development as a “real curveball” for the city, highlighting uncertainty about what the Trump administration might require regarding the upcoming Olympics.
Continuing challenges for the city include ongoing graffiti issues, exemplified by a $25,800 expenditure to paint over graffiti in the 2nd Street Tunnel, which was immediately vandalized again within 24 hours. Steve King, president of the Board of Public Works, voiced frustration at the misuse of taxpayer funds aimed at improving the city.
Additionally, L.A. County supervisors are considering the potential appointment of a receiver to manage the struggling juvenile halls. However, they stress that any such action must confront existing union agreements and civil service regulations, which they argue hinder the resolution of issues surrounding problematic employees.
In a broader context, a leading law firm pursuing a lawsuit against L.A. County over childhood sexual abuse has requested a federal investigation into the circumstances surrounding the harm experienced by children in county custody. Attorney John Manly’s letter to the U.S. Attorney’s Office called for an “immediate investigation” into any potential federal crimes committed by county Probation Department staff.
On the environmental front, a new ordinance set to take effect in L.A. County will mandate that landlords in unincorporated areas provide means for tenants to maintain their rental units at 82 degrees or lower in response to increasing heat-related health risks exacerbated by climate change.
In a significant legal development, a law firm representing the city of Los Angeles in a homelessness case submitted an astonishing $1.8 million invoice for just two weeks of work in May, raising questions about the city’s capacity to handle escalated legal costs amid pressing financial constraints.
Also noteworthy is a proposal from the hotel workers union requiring voter approval for constructing “event centers” for the 2028 Olympics, which includes sports venues and concert halls. Paul Krekorian, formerly of the City Council, stated that this measure could complicate essential projects for the Olympics, making them potentially unfeasible.
Lastly, Deputy Mayor Randall Winston is set to go on military leave for training next week. Originally scheduled to start in January, he postponed his absence to assist with wildfire response efforts. In his absence, Andrea Greene, Executive Officer of the Office of Infrastructure, will step in until his return in mid-December.
In upcoming meetings, county supervisors are also reviewing the sheriff department’s use-of-force policies, specifically as they relate to journalists covering ongoing ICE raids.
image source from：latimes
