Candidate Pays $40,000 in Late Taxes

Encino lawyer-developer Ted Stein, a candidate for Los Angeles city attorney in the April 8 election, has repaid about $40,000 in back property taxes in hopes of keeping incumbent James K. Hahn from making the debts a campaign issue.

Stein campaign consultant Harvey Englander said Monday that his candidate had done nothing wrong in letting the tax bills on two apartment buildings he co-owns turn delinquent and then entering a five-year repayment plan with Los Angeles County to clear the debts. Rather, he said, Stein decided to write a check for his portion of the total--and asked his business partners to do the same--to prevent further discussion of the matter, which was revealed by The Times earlier this month.

“It’s crazy to have these kinds of things as issues in the race,” Englander said. “He’d like to talk about things the city attorney ought to be doing and the failure of the incumbent city attorney.”

Hahn, however, was not satisfied with the repayment, saying that Stein is responsible for the full $95,000 in delinquent taxes--even though he only owns 40% of one building and 50% of the other--because he is the managing general partner in both deals.

“To me, it seems Ted got caught with his hand in the cookie jar here. The only reason he’s paying anything back is because it’s become a public embarrassment,” Hahn said. “Now he’s got to work on getting the rest of it paid off. Before he puts one more dime into his campaign, he ought to figure out how he’s going to make the taxpayers of Los Angeles whole.”

At issue are delinquent 1992 property taxes on a 91-unit apartment building in Koreatown valued at $3.36 million and a $2.6-million Chatsworth complex with 60 units, according to property and tax records. Stein, an attorney who has spent the last two decades buying and developing property--mostly in the San Fernando Valley--has the controlling interest in the limited partnerships that own both.

*

Like about 30,000 property owners in Los Angeles County, Stein’s partnerships entered installment plans to repay the delinquent taxes, one starting in July 1993, the other in October 1995. Delinquent taxpayers have up to five years to enter into an installment plan or risk having the government seize and sell their property; the installment plan requires 20% of the debt upfront and 20% each year, so the debts on Stein’s properties would be repaid in full by 2000.

With the $39,965 Stein paid last week, $55,004 remains outstanding. That includes a 10% delinquent penalty and 1.5% interest each month.

Englander declined to disclose who Stein’s partners are, or release a copy of the letter he says Stein sent them last week urging them to pay the full debt now.

“Hahn said last week that people should pay their debts--why shouldn’t the limited partners pay their debts? The issue here is not the limited partners, the issue is Ted Stein. Has Ted Stein paid his taxes? The answer is yes,” Englander said. “Jimmy Hahn is trying to do everything he possibly can to divert attention from his performance. The issue is Jim Hahn’s abysmal performance. Jim Hahn has been missing in action as city attorney . . . and wants to talk about anything except his record.”

Hahn, who was first elected in 1985, responded that he is “happy to campaign on my record as city attorney.”

“I’m proud of the record I’ve had,” he added. “If my record is what we’re going to be debating, I think his record in business is fair game as well.”