An effort to temporarily block large retail chains from opening in Chinatown failed to get the needed votes Tuesday.
A second vote is scheduled for Wednesday.
The Los Angeles City Council voted 10-4 in favor of the moratorium on retail stores over 20,000 square feet, but the item needed 12 votes to pass because it was introduced as an emergency ordinance.
The council sought to use its power to temporarily block certain building permits in order to study the potential effects of the big-box stores on the neighborhood's character and businesses for up to two years.
The attempt was spurred by Wal-Mart Stores Inc.'s effort to open a 33,000-square-foot Wal-Mart Neighborhood Market in a space on the northwest corner of Grand and Cesar E. Chavez avenues near downtown that has been vacant for nearly 20 years.
The project stirred fears about the grocery store squeezing out small Chinese businesses with its notoriously anti-union position.
Wal-Mart received the necessary building permits in March and has been under construction since then. A coalition of labor groups has filed lawsuits and appeals to the city's Planning Department challenging the legality of the city's permitting process and public notification of Wal-Mart's permit process. A city zoning administrator heard the appeal last week and is expected to issue a ruling within 45 days.
Councilman Ed Reyes, who first called for the so-called interim control ordinance on retail chains, said a new school built across the street from the Wal-Mart did not exist when the project was entitled and raised new public safety concerns because of the hundreds of students who crowd the sidewalks in the area.
In an impassioned speech, Reyes said the moratorium was also about preserving Chinatown's character as a Southeast Asian immigrant community.
"Chinatown is precious. Chinatown has a history. It has wonderful landmarks. It is a global destination for tourists. What makes it unique are its small shops ... All I'm asking is for a pause,'' Reyes said.
Dozens of Chinatown small business owners, residents and community activists urged the council to pass the ordinance.
Business leaders, including Los Angeles Area Chamber of Commerce CEO Gary Toebben, described the proposed temporary ban on large chain stores in Chinatown as an attack on all businesses across the city.
"It's about whether we send a message that if you ... jump through every hoop and you do it right ... the rug can be pulled out from under you, whether you're a large business or small,'' Toebben told the council.
Reyes protested that he was ``not preventing business. I want to accentuate it.''
``All the (ordinance) does is allows me the opportunity to pay attention to all of my bosses, all of my constituents,'' he said.
City Council members Joe Buscaino, Mitchell Englander, Bernard Parks, and Jan Perry opposed the moratorium and further study. Councilman Tony Cardenas was not present for the vote.
The City Council is scheduled to take another vote on the project Wednesday. Supporters of a moratorium were hopeful they could convince Cardenas and one opposing member to vote their way during a second vote.
Wal-Mart Senior Director of Community Affairs Steven Restivo said the Chinatown location is on schedule to open early next year, and 2,000 people have already applied to work at the store. He said the neighborhood market will
"provide residents with a new option for employment and affordable groceries.''
"When you strip away all the politics and special interests, this is pretty simple. We're revitalizing a decades-old empty space and providing a service that downtown residents need and want,'' Restivo said.
"When we open downtown, our expectation is that the reception will be ...happy customers who are saving money, dedicated associates who are proud oftheir jobs and surrounding-area small businesses that benefit from the boost i foot traffic that comes with a Wal-Mart.''