His crusade to house L.A.’s poor praised by Oprah Winfrey, Garcetti. But others have doubts

Abstract

"SoLa is building right now around 1,300 units," Muoto told admiring attendees. The day after the Avalon opening, the nonprofit Inner City Law Center alleged in a suit that SoLa exposed tenants in one of its buildings to "Health and safety threats on a daily basis" including "Long-term infestations of rats and cockroaches, severe water damage destabilizing the walls and ceilings, rampant mold" while the company's principals "Have lined their own pockets with ... rental payments by skimping on necessary repairs and regular maintenance." Public records show that many of SoLa's buildings have been repeatedly cited for code violations, a fact Muoto attributes to their age and the deteriorated condition they were in when he purchased them. A Times analysis of Los Angeles Housing Department records shows that, within a year before SoLa's purchase, 64 of its buildings had tenant complaints and orders to correct code violations. The law firm tipped off KCBS-TV Channel 2 investigative reporter David Goldstein, whose Oct. 16 report on the Washington Boulevard building featured tenants displaying baggies full of cockroaches and bed bugs interspersed with SoLa promotional videos showing Muoto touting his company's social mission. Muoto points to SoLa's record of making housing available for poor people who hold Section 8 federal rental subsidies, resulting in a decrease in the average income of SoLa tenants. In 155 buildings subject to rent control, rents for about a third of units have been increased more than the annual limit - allowable only when a tenant vacates - and those increases in many cases were more than 50%. SoLa said the Housing Department data were grossly inaccurate, but a check of one building confirmed that six of 16 units has been raised between 57% and 92% after tenants left. About 90% of it will go into new affordable housing in South LA. Muoto said the controversy has caused him to stop buying older buildings, but SoLa has no plan to divest its aging housing portfolio.