Tuesday, June 21, 2022

Pershing Square Redesign Funding Questions for Retiring Rec and Parks General Manager

On May 19, 2022 (Archive link after the City removed the agenda; here is the associated board report), as documented in our live tweet, the Recreation and Parks Commission grilled Rec and Parks GM Mike Shull about the lack of funding or documents handed over by former Councilman Jose Huizar's dissolved nonprofit, Pershing Square ReNew.


On June 17, the City Hall's Channel 35 announced that Shull has retired from city service. Now outgoing Mayor Eric Garcetti seeks to appoint Jimmy Kim to replace him. This is odd timing, because it's the right of a new Mayor to appoint General Managers as well as Commissioners, and one will be elected in November.

Update, January 19, 2022: A motion from embattled councilmember Kevin de Leon seeks to move $3.5 Million from Onni Group's 1000 S. Hope project to the Pershing Square Improvement Fund.

Update December 29, 2025: Because City agendas and other important public files keep vanishing due to link rot, we've put the audio portion of the May 19, 2022 Rec and Parks Commission hearing on the Pershing Square on YouTube, and embed it here. A transcript is below.


 (00:00:03):
Good morning, Commissioners.

(00:00:03):
Darryl Ford, Planning, Maintenance, and Construction Branch.

(00:00:06):
Report 22-124 is in regards to Pershing Square Renovation Phase 1A.

(00:00:12):
It's recommending the Board approve the final plans and specifications for the

(00:00:15):
project and authorize the project to be bid through one of our on-call contractors.

(00:00:20):
So just as detailed in the report,

(00:00:22):
as the Commission knows,

(00:00:23):
Pershing Square,

(00:00:24):
of course,

(00:00:25):
is located downtown on Olive Street.

(00:00:28):
It is a five acre park and this Pershing Square project has been one that the city

(00:00:34):
has been working on and we are very excited to be able to bring Phase 1A to you

(00:00:38):
today for approval.

(00:00:40):
Just very quickly,

(00:00:41):
with a little bit of background as detailed in the report,

(00:00:44):
this effort is an outgrowth of a long effort from the CD14 to look at revitalizing

(00:00:51):
Persian Square.

(00:00:52):
This started off with a ambitious international design competition that started back in 2015.

(00:00:58):
Ultimately, a firm, Agence Ter, was selected as a winner design competition.

(00:01:04):
And following that, the Bureau of Engineering ultimately brought on board

(00:01:08):
a locally based agency,

(00:01:10):
Gruen Associates,

(00:01:11):
to assist with developing the feasibility and a master plan for the implementation

(00:01:16):
of the Pershing Square project.

(00:01:19):
So again,

(00:01:19):
as detailed the report today before you is the approval of the phase 1A of the

(00:01:22):
project,

(00:01:23):
which specifically includes perimeter improvements along Olive Street,

(00:01:27):
including the demolition of the cafe structure and elevators,

(00:01:30):
revitalization of the park edge landscaping,

(00:01:32):
a new street edge entry plaza,

(00:01:34):
and new glass elevators.

(00:01:36):
So again,

(00:01:37):
this project is just the first phase of a lot of planned improvements at Person

(00:01:41):
Square,

(00:01:41):
but the plans are ready and permits have been secured for phase 1A.

(00:01:46):
And the report before you is recommending that the board approve those plans so we

(00:01:49):
can move forward with that.

(00:01:51):
I did want to note that this project was presented multiple times to the community,

(00:01:56):
the board,

(00:01:56):
and the task force as recently back as November,

(00:02:00):
2021 is last time we're at the task force meeting to move this forward to the

(00:02:03):
board.

(00:02:04):
And again,

(00:02:05):
the project is at this time anticipated that construction will take approximately

(00:02:08):
15 months.

(00:02:09):
But again, we're excited to be able to bring it before you today for your review.

(00:02:14):
And that concludes our report.

(00:02:15):
And I would note that staff from the Bureau of Engineering is here as well if you

(00:02:18):
have any questions about the project.

(00:02:21):
Thank you, Darryl.

(00:02:22):
And I just want to note that when the Pershing Square renovation project was

(00:02:27):
discussed with the board years ago,

(00:02:30):
we were told that major stakeholders around Pershing Square

(00:02:34):
who would benefit from the long-term improvements to Pershing Square would play a

(00:02:38):
major role in fundraising for the project.

(00:02:41):
And this was mainly through Pershing Square Renew.

(00:02:45):
And Pershing Square Renew received a lot of publicity for their intent to raise

(00:02:51):
funds for the project.

(00:02:52):
But according to this report,

(00:02:55):
2.5 million in Quimby fees were originally approved by the board and over 4.5

(00:03:01):
million had been awarded by the city council

(00:03:04):
And the department is providing funding from another Pershing Square Capital

(00:03:09):
Improvements account.

(00:03:12):
There is no reference to funds that were secured for the project as a result of the

(00:03:16):
fundraising by Pershing Square Renew.

(00:03:20):
And are any of those funds to be used,

(00:03:24):
the funds that are going to be used for the project,

(00:03:27):
are they the result of any fundraising by Pershing Square Renew?

(00:03:35):
Hi, Commissioner, Darryl Ford again.

(00:03:36):
The fundings that are identified for the project in the board report are a

(00:03:40):
combination of funds for a RAP account,

(00:03:43):
essentially for the Pershing Square Capital Improvement Account,

(00:03:45):
as noted.

(00:03:46):
And additionally,

(00:03:47):
there were funds that,

(00:03:48):
working with Council District 14,

(00:03:49):
they were able to secure,

(00:03:50):
which are called TFAR funds,

(00:03:51):
which are transfer of floor area rights.

(00:03:54):
So those are the funding sources that will be used,

(00:03:56):
that are anticipated to be used for Phase 1A.

(00:04:00):
Okay.

(00:04:00):
Anything from Pershing Square Renew with that?

(00:04:03):
the fundraising effort that they had envisioned?

(00:04:10):
No, not for phase 1A.

(00:04:11):
The funds here are gonna be the two accounts noted.

(00:04:14):
Okay, very good, thank you.

(00:04:16):
Any questions or comments from the commissioners?

(00:04:19):
Yes, this is Lynn Alvarez.

(00:04:21):
Following up on Sylvia's comment,

(00:04:25):
I had the same question essentially,

(00:04:28):
which is,

(00:04:28):
has there been an accounting of what happened to the funds

(00:04:33):
that were raised by Pershing Square Renew.

(00:04:37):
I don't have a sense of how much did they actually raise?

(00:04:40):
How much did they spend?

(00:04:42):
How did they spend it?

(00:04:44):
Is there any money left over?

(00:04:46):
I'm assuming that they had to be accountable to somebody.

(00:04:52):
So what happened with that?

(00:04:55):
And are we going to get some kind of a report because as

(00:05:00):
President Patsaouras mentioned, I mean, we really sort of turned it over to them to take charge.

(00:05:06):
And I think it's our fiduciary duty to see what did they do with the money and what

(00:05:12):
money did they actually raise?

(00:05:14):
So do we have an accounting on that, Daryl?

(00:05:19):
Commissioner Alvarez,

(00:05:20):
I don't have extensive information about the Pershing Square Renew,

(00:05:23):
just about the information that's in front of you.

(00:05:25):
I don't have that information, though.

(00:05:28):
This is Mike Shull, General Manager.

(00:05:35):
So Pershing Square Renew, I mean, they obviously are no longer in existence.

(00:05:40):
The department never gave,

(00:05:43):
there was never any funding transactions between Rec and Parks and Pershing Square

(00:05:47):
Renew.

(00:05:49):
They were totally independent.

(00:05:53):
and were funded originally through a development downtown.

(00:05:58):
And I don't recall the development, but it was managed under the previous...

(00:06:05):
CD14 council office, not the current council office.

(00:06:07):
They were not involved at all.

(00:06:11):
So that money came through a developer that had them start up.

(00:06:17):
We did not have access to any of their records because none of those funds were

(00:06:22):
actual city funds.

(00:06:23):
So unfortunately, we would not be able to provide any record of any.

(00:06:30):
And to my knowledge, I don't believe that they

(00:06:34):
raised any money to my recollection and knowledge.

(00:06:37):
But anyway,

(00:06:39):
I don't know if that's very helpful,

(00:06:40):
but I just don't know that staff would be able to provide such an accounting when

(00:06:45):
we did not have any oversight of their organization.

(00:06:56):
All right.

(00:06:57):
Thank you.

(00:06:57):
I mean, I guess this

(00:06:59):
I hope that we didn't lose any time in moving this project forward because we

(00:07:03):
relied on that organization.

(00:07:08):
So,

(00:07:10):
but if the case is that there were no city funds and rec and parks funds that were

(00:07:16):
used to support Pershing Square Renew,

(00:07:20):
then I guess that's fine.

(00:07:23):
Lesson learned there.

(00:07:25):
I had just a couple of quick questions.

(00:07:29):
if I'm understanding this correctly,

(00:07:31):
this project will basically go out to bid,

(00:07:34):
we'll get responses in July,

(00:07:36):
and then it's going to take 15 months to do phase 1A,

(00:07:39):
which will be the fall,

(00:07:41):
basically this will be completed the fall of 2023.

(00:07:44):
And then the mention of phases 1B and phase 2 says that the,

(00:07:58):
I guess what I'm we're still waiting on funding for that for construction to become available.

(00:08:04):
And I was wondering how much funding is needed before we begin phase one B and

(00:08:09):
phase two and how much money do we have?

(00:08:14):
So if we could just some specifics on the next phases and are any of those going to

(00:08:19):
be overlapping with phase one A so that we can,

(00:08:24):
you know,

(00:08:25):
I'd like to get a sense of the timing for the other phases as well, if that's possible.

(00:08:29):
Thank you.

(00:08:35):
Hi, Commissioner Alvarez.

(00:08:36):
I'll ask the BOE staff just,

(00:08:38):
if they can,

(00:08:39):
David Wang,

(00:08:39):
another project manager here,

(00:08:40):
could probably jump in with a little bit of detail in Phase 1B.

(00:08:44):
David?

(00:09:01):
Well, Commissioner, I see he's on the thing.

(00:09:02):
Can you guys hear me?

(00:09:03):
Oh, there you go.

(00:09:04):
Go ahead, David.

(00:09:04):
Sorry.

(00:09:05):
Sorry.

(00:09:07):
Commissioner, and this is David Wendt with Bureau of Engineering.

(00:09:10):
So as far as the Phase 1B, the cost estimate is around $1.5 million.

(00:09:15):
And Phase 2, the cost estimate is about $14 million.

(00:09:23):
So how much more do we need to raise to get going on Phase 1B?

(00:09:28):
We need about $1.5 million.

(00:09:31):
And so what's the timing for that?

(00:09:33):
When do we anticipate getting that funding?

(00:09:35):
And when would we be able to begin 1B?

(00:09:39):
We don't have a timeline for the funding for phase 1B.

(00:09:46):
But phase 1B work is expected to be about six months once we have the funding.

(00:09:51):
Could we do it simultaneously with 1A if we had the funding or overlap at some level?

(00:09:58):
It's possible because phase 1B is,

(00:10:02):
we're really close to getting the plan check approval from the building safety

(00:10:06):
department.

(00:10:09):
So I don't know if this goes back to Daryl for this question.

(00:10:14):
Is this a high priority to try and get this funding so that we can do phase 1B

(00:10:21):
simultaneous with 1A?

(00:10:23):
And so by the fall of 2023,

(00:10:26):
we can hopefully have both A and B done.

(00:10:31):
Hi, commissioner.

(00:10:31):
I mean,

(00:10:32):
obviously the,

(00:10:32):
I didn't say obviously,

(00:10:33):
but the project of course is a high priority for the city to implement.

(00:10:37):
The desire here was to move phase 1A to the board for your approval,

(00:10:40):
because we do have full funding for it.

(00:10:42):
The plans are ready.

(00:10:43):
So we wanted to go ahead and get that moving.

(00:10:45):
And as David noted, we do have an estimate for phase 1B and we know that there's a shortfall.

(00:10:50):
So we'll continue our efforts to identify that, but our goal was to,

(00:10:53):
sort of not delay phase 1A that started to get it out as soon as we could,

(00:10:56):
because it can be done independently of phase 1B.

(00:11:06):
Okay,

(00:11:06):
well,

(00:11:07):
I do want to add that this obviously is a very,

(00:11:11):
very difficult project to build and we need

(00:11:15):
We just need to make sure that the design,

(00:11:18):
as beautiful as it might be,

(00:11:20):
is not going to lead to extreme costs overrun.

(00:11:23):
So please, Steph, just be very aware of the issues that are facing us.

(00:11:30):
Any other questions or comments from the commissioners?

(00:11:34):
I guess I would just like to,

(00:11:36):
given how long this has taken and all the twists and turns,

(00:11:42):
and really how important this park is to the city,

(00:11:45):
that maybe we could have a report in the next,

(00:11:50):
you know,

(00:11:51):
I mean,

(00:11:51):
put a period of time,

(00:11:52):
whatever seems reasonable,

(00:11:54):
to report back on securing funding for 1B.

(00:11:58):
And it would really,

(00:11:59):
I mean,

(00:12:00):
it seemed,

(00:12:00):
I mean,

(00:12:01):
obviously it's not an insignificant amount of money,

(00:12:04):
but it's not in the multi-millions of dollars.

(00:12:07):
I think it's something reachable to be able to get the funding for 1B.

(00:12:11):
So we can get moving on that too.

(00:12:14):
And so having a check-in in the next four or five months to let us know what

(00:12:21):
progress potentially we have made so that we can really get going on 1B as well.

(00:12:28):
So that would be my request.

(00:12:30):
Thank you, Commissioner Alvarez.

(00:12:34):
So we will ask staff to please come back to us in the...

(00:12:39):
the next several months with a report on the funding progress anything else from

(00:12:44):
the commissioners okay okay thank you we'll move

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