By Hillel Aron
By Joseph Tsidulko
By Patrick Range McDonald
By David Futch
By Hillel Aron
By Dennis Romero
By Jill Stewart
By Dennis Romero
In the meantime, Redlands community leaders floated a slow-growth initiative aimed at Majestic and several competing developers. Majestic spent $250,000 in 1994 to defeat the measure; it passed, and the ensuing negotiations with the city over annexation and site plans did not go well. "Majestic always spoke with a forked tongue," former Mayor Swen Larsen, who retired at the end of 1997, says of the negotiations. "They would tell me one thing and then do another."
While Majestic was bickering with city officials, two rival developers steamed ahead on nearby projects that fell within the city limits. By fall of 1997 one had signed a development agreement with the city and a second, Redlands Crossing, was on the verge of doing so. A second slow-growth initiative was passed by city voters that November - this time Majestic did not oppose it - and Redlands Crossing needed to finalize its deal with the city before the end of the year to be exempt from the initiative's requirements. As the deadline approached, talks with the city stalled; it later turned out Majestic had quietly promised the City Council a $2.25 million bonus for signing with Majestic first.
Majestic's tactics provoked immediate rebukes. "Majestic is playing hardball," the San Bernardino Sun editorialized; "Redlands must call a stop to any further bullying." Rather than back down, Majestic pressed its case, demanding every piece of paper the city had generated in its talks on Redlands Crossing - an unusual and cumbersome task involving thousands of legally sensitive documents. "I am sick and tired of dealing with them," Councilwoman Geni Banda told the Riverside Press-Enterprise. "I am tired of their unnecessarily aggressive action."
The effect of the delays was to kill the Crossings project. The developers have subsequently sued the city for $24 million. "We were a threat to [Majestic] so they put a contract out on us," Ben Reilling, Redlands Crossing's developer, concluded. "I can understand it from a business point of view, but it doesn't make me happy."
While Majestic's negotiations with Redlands continue, the developer's lawyers say it is no longer offering the regional mall that Redlands said it wanted. They are still seeking to build a power center there, but it seems that yet another competitor, this one in the city of San Bernardino, signed an agreement with Majestic's prospective anchor tenant. Said Roski, "We thought it was going to be a slam-dunk deal - it didn't quite turn out."
It's hard to say what prompted Ed Roskito step out from 20 years of obscurity as a backroom development tycoon and into his new role as a leader of L.A.'s downtown establishment. Perhaps he felt satisfied with Majestic's level of success. Perhaps he believed the stench of the Industry scandal had finally blown over. Or perhaps it was simply, as he put it recently, that "I had something to give back" to his hometown.
Whatever the reason, Roski moved quickly and on a broad scale. First there was the 1995 acquisition of the Kings, a solid big-league franchise despite the financial troubles that swamped former team owner Bruce McNall. The following year, Roski and Anschutz initiated talks with the city on construction of a downtown sports arena and, nearby, a hotel, entertainment and shopping complex. Now, Roski is playing point man in the city's high-stakes bid to land an NFL franchise.
Through it all, Roski has operated in characteristic fashion - negotiating quietly, releasing details only when pressed, pushing public entities for millions of dollars in subsidies, and spending lavishly on lobbyists to advance his interests.
There were setbacks, of course. When his proposal for a long-term city subsidy of $70 million to the sports arena became public, Councilman Joel Wachs vowed to sponsor an initiative to block the deal, and after a series of threats to walk away from the project, Roski backed off. Still, according to Steve Soboroff, an experienced Westside real estate consultant who served as Mayor Riordan's negotiator on the deal, Roski still got most of what he wanted.
True, he lost the $70 million, but those funds were replaced by a commitment from the Community Redevelopment Agency to spend $12 million on land acquisition and site preparation. In fact, said Soboroff, once inflation and interest are factored in, the value of $12 million cash is virtually equal to $70 million distributed over 30 years. "It's a better deal for Anschutz and Roski than it was before," Soboroff asserted.
As his downtown financial commitments have increased, so has Roski's spending. He retained the services of Latham & Watkins attorney George Mihlsten, the consummate Spring Street insider who in 1997 secured $70 million in city tax breaks for DreamWorks' Playa Vista development and is today shepherding Universal Studios $2 billion expansion. In addition, Roski hired two of the city's top lobbying firms, Cerrell & Associates and Marathon Communications, to work the corridors of City Hall. Since June of 1996, Majestic Realty and the L.A. Arena Company have topped the city Ethics Commission's list of companies attempting to influence policy at City Hall, spending a total of almost $600,000.
Along with outlays for lobbying, Roski made substantial political contributions in L.A. and around the state. But his free spending in Chino was an exception; Roski is normally selective in his largess, and the campaign-finance reports he files with the state suggest a focused effort to curry favor. At the state level, for instance, Roski contributed heavily to the coffers of then-state Treasurer Matt Fong, who was uniquely situated to rule on state tax assessments. In L.A., Roski gives heavily to District Attorney Gil Garcetti - more than $40,000 since 1993. Asked why he donates such large sums to the county's top law-enforcement authority, Roski said, "Gil is a friend. I think he is doing great things for Los Angeles."