LA
05/04/2011 01:32 pm ET Updated Jul 04, 2011

Downtown LA Tax Breaks: Are Subsidies For Developers Hurting Or Helping The City?

The downtown J.W. Marriott has done brisk business since it opened last year, filling up rooms and producing much-needed tax revenue for the cash-strapped city of Los Angeles.

But that revenue will come at a price. To get the 54-story skyscraper built, Mayor Antonio Villaraigosa and the City Council decided to let the developer, Anschutz Entertainment Group, keep as much as $270 million in city taxes through 2035.

Since then, two other similar tax deals have been inked by city officials. One covers the planned Mandarin Oriental Hotel, part of the long-delayed Grand Avenue project near Disney Hall. A second would allow a new 45-story Wilshire Grand to keep nearly half of the new taxes that it would generate between 2015 and 2043.

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