South LA small businesses looking for missing details in USC expansion plan

With a final vote postponed until late November, The University of Southern California has a few more months to provide more details in its quest to get City approval for extensive development and renovations both on campus and on properties nearby.

Community interest has been intensely focused on University Village, a shopping development just across Jefferson Boulevard from the main campus. Opposition to the development has mostly centered on concerns about student housing to be built there. But small businesses in the area are worried about their place in the new development.

Local small businesses wonder if and how they’ll be included

The need for improvement to University Village (UV) is not in dispute. The current buildings are tatty-looking and in need of modernization and upgrades. The proposed new development will contain retail space, including a full-service grocery store, academic and administrative space, convention space, and more student housing.

Most of the businesses currently operating in UV are small, locally-owned and -operated shops, including a bicycle shop, a shoe-repair shop, an optometrist, a cigar shop, nail salons, a hair salon, and a food court populated with miniature mom-&-pop restaurants. There is also a small multi-screen discount movie theater, a discount grocery, a 99-cent store, and the lone big-box retailer, Starbucks.

The merchants running the local shops have been asking, during the mutli-year process of developing the plan, for more details on a range of issues: when they are expected to move out, what kind of help they will receive for relocation during the projected two-year demolition and construction process, and if and how they will be allowed back in. They have been given a move-out target of August 2013, but that’s the most detail they say they have received.

USC has promised relocation help, but no details have been provided in the Development Agreement so far. Nor have the merchants been told what criteria will be used to decide who will be allowed back in after construction.

imagePacked aisles at Los Angeles City PLUM Meeting August 21. A vote approving or denying USC’s Specific Plan for University Village was postponed to November.

Addressing Los Angeles City Council’s PLUM (Planning and Land Use Management) commissioners at a packed August hearing, local businessman Jorge Nuno stated during public comments that the community benefit package, which will be part of the Development Agreement, doesn’t put enough emphasis on resources to help small businesses.

Nuno, who owns The NTS Group, a small advertising and marketing firm located on East 35th Street, has been studying the issue over the last couple of years. In a follow-up interview, he said he “sees a lot of challenges in the area: small businesses need to have access to the development. They need educational resources for business plans.”

USC offers free basic legal help to local small businesses

In official documents and public statements, USC points to two clinics specifically aimed at helping local small businesses. One, the Small Business Clinic, administered through the Gould School of Law, provides help with basic start-up legal paperwork to local small businesses. The Business Clinic’s services, free except for filing costs, include structuring businesses -– as corporations, limited liability partnerships, or sole proprietorships and the like. The clinic also helps draft basic contracts with vendors and clients of the participating business.

Faculty advisor Michael Chasalow said the clinic keeps the paperwork as simple as possible. “Our demographic is not fancy folk. It’s primarily salt-of-the-earth,” mom-and-pop businesses that provide services to the community. “They don’t want or need something complicated,” said Chasalow.

The purpose of the student-staffed clinic is educational -– to teach students how to craft the best service for customers, but “the benefits go to the community,” said Chasalow. In the five years the clinic has been open, it’s served almost 300 clients and currently has a waiting list. When clients need more than the SBC offers, they are referred to area non-profits like SCORE, Public Counsel, and the Pacific Asian Consortium in Employment (PACE), or the local Chamber of Commerce.

“What we offer,” said Chasalow, “is very different than the kind of advice you’d get if you went to a firm,” which would charge high fees. “If you’re trying to start a business on five-thousand dollars, an eight- hundred dollar fee is a lot.”

USC’s free business consulting clinic

USC also offers a free business consulting clinic, Los Angeles Community Impact (LACI), through the Marshall School of Business. Also student-run, LACI helps local entrepreneurs create business and marketing plans that will help them sustain and grow their businesses.

According to Neil Garvey, a junior and LACI’s vice-president for external affairs, most of the clinic’s clients need help focusing their goals. “You don’t have time to think about where your business is going if you’re just busy running the business,” but he said, “a business plan isn’t as complicated as people expect it to be.”

LACI president Jeremy Gross, also a junior, concurred, saying, “Many are spread too thin. They say yes to all their clients’ requests,” but with doing “payroll, managing staff and clients, paying the bills,” it’s aquestion of limited time and resources. “Many clients just have too many ideas. We help them winnow that.”

LACI assigns clients a team of four to five students. Over the course of a process that can stretch to up to twelve weeks, team members help clients refine their goals. The team carries out studies and surveys assessing local awareness of and interest in the client’s services, identifies possible competition, and then delivers a set of succinct recommendations and “next-steps” that clients can carry out on their own. The team then conducts a follow-up a month or so later to see how things are working out.

Is the community aware of these services?

Nuno said some small business owners he talked to confirmed USC has reached out to make them aware of these programs. But, he said, “many say they feel intimidated, because USC is talking big numbers, but they’re small businesses.”

That statement may seem a bit odd, given the fact that both clinics tailor their free services for mom-and-pops, but, said Chasalow, “with law in particular, you see people who feel they lack sophistication and may be intimidated from the get-go.”

Garvey and Gross, of LACI, feel that the sheer size of USC might lead to a perception that its programs are too hard to access. For instance, said Garvey, if you’re trying to become a vendor to the University, “the bureaucracy and red tape” of dealing with the university “is very frustrating,” even though USC has a local vendor initiative.

Gross added, “A lot of the businesses around USC don’t have a deep relationship with USC, but often want one. It’s almost like a lone market within a larger market. it’s very difficult for a mom-and-pop to get through the red tape. How do you even find out who to call?”

Said Garvey, “I think that speaks to the larger issue that USC students are a completely different market than the surrounding area. And businesses serve either one or the other, but usually not both.” That town-and-gown division might contribute to the idea that even services aimed at local small business, like the clinics, are intimidatingly inaccessible.

Loans to help local business

Some of what Nuno says is missing from USC’s current draft Development Agreement does involve larger numbers. He’d like to see “a revolving loan fund to help with relocation and business expansion…. USC could really do something big with a small amount of money,” says Nuno.

He says one to two million dollars would be ample to provide revolving loans to up to forty small local businesses.

Final city vote postponed until late November

It would be erroneous to say that the community is universally against the development. There is significant community support for the proposed improvements to shopping choices, aesthetics, and even the increased public safety that is expected as a result of the rebuilding.

But small businesses are hoping missing details will be provided in time. The current draft Development Agreement does not as yet provide them. And that’s important, because the Final Development Agreement with the City will be a legally binding document. With the final vote postponed until late November, there is still time for those details to be fleshed out. But not much time.