When Los Angeles officials announced they were reviewing the safety of the city’s jewelry district, it looked as if manufacturers would be forced into a classic face-off: public officials vs. private enterprise.

Instead, the city and industry joined together to write new safety rules—and the result is a compromise that both sides not only can live with but also are happy about. The new guidelines went into effect in January.

James Marquart, president of the Manufacturing Jewelers and Suppliers of America, which was involved in the process, calls it a model public-private partnership.

“It’s a win-win for everybody,” he says. “It’s rare that a city or county takes an industry point of view into account or allows us to get as involved in the process as we were.”

A lawsuit looms. There are good feelings now, but when the process began, it looked as if the industry was headed for real trouble. It started with a complaint: Neighbors complained to authorities about chemical fumes being emitted by jewelry manufacturers in what everyone now admits was a poorly maintained building. When inspectors discovered excessive metallic dust in the building, the California state attorney general sent the owners a letter demanding they clean up their act. “That really got the industry’s attention,” says Marquart.

It got the city’s, too. It’s unclear why no one had enforced the rules all these years, but the authorities were determined to do so now. This worried the industry, which, like the city, had basically ignored the regulations.

According to the Los Angeles Times , fire inspectors found more than a ton of cyanide carelessly stored in the basement of one building. The legal limit per building is 10 pounds. Factories had blocked exits and fire escapes, and “ventilation” consisted of a fan or open window. Some companies were dumping hazardous waste in the sewer system. Even the factories’ location was illegal—they were in high-rises meant for offices and retail stores, not manufacturing. The law requires that companies working with hazardous chemicals, flames, and furnaces do so in isolated industrial parks.

Vache Fronjian of My Way Jewelry Company is a member of the task force. He says manufacturers were shocked by the city’s new aggressiveness. “They were asking us to follow things which had not been enforced for years,” he remembers.

Even inspectors and public health officials found the original rules vague and out of date, so they wrote new ones. But when people saw the city’s first rewrite—with no industry input—the anxiety level jumped. “People thought they were going to shut the entire industry down,” says another task force member, Vasken Pliliguian, of Progress Machine and Tool Corporation.

Fortunately, the city didn’t want to drive out an industry that employs 15,000 people and generates $150 million in tax revenue—statistics that industry officials tirelessly trumpeted to their municipal counterparts. Despite the widespread violations, the industry had an exemplary safety record. Amy Wenslow, MJSA’s West Coast regional manager, notes that, if there had been serious problems, the tone likely would have been more confrontational.

A task force was formed to revise the revisions, with both the industry and city on board. Eventually, the state and federal government became involved as well.

“It was a classic negotiation,” says another task force member, Hank Ballard, national sales manager for Precious Metals West. “They came out real strong with what they wanted. We came back and said, ‘You are going to kill us.’ “

One knotty issue was cyanide. The industry traditionally has used the powdered form of the compound to “strip” raw casting, and the fire department worried that a fire could create lethal cyanide gas. In the end, the sides hammered out a compromise that allows cyanide only in a 4% aqueous (liquid) solution.

In a major concession, the city changed the zoning requirement so the manufacturers could remain in the buildings. But the industry agreed, among other concessions, to store chemicals properly, treat all chemical waste, and discontinue use of blow furnaces, propane, acetylene, and pure oxygen in wax injection (only compressed air may be used).

Alan Wendell, principal inspector for Los Angeles Building and Safety, says most of the rules will not be a “big deal.”

“The amount of work [the companies] will have to do to come into compliance will hopefully be minimal,” he explains. “They will need the proper cabinets to store chemicals. We may ask them to shift some things around, or put a different lock on the exit door so people can get out quickly if there’s an emergency. Most of it is basically good housekeeping and common sense.”

Cooperation between city and industry not only benefited both but also helped the different government agencies learn from each other. “Each agency knows their own component, but they don’t necessarily know anything about what the other requires,” says Wenslow. “For cyanide, the fire department says manufacturers need a permit, and there’s a limit on the amount each company can have. But the county fire department has a limit for the entire building. So what’s the rule—for each company, or the building? [By getting together], people saw how all the spokes of the wheel were related.”

A new spirit. The task force, which took a year and a half to draft its guidelines, forged not only new rules but also a spirit of cooperation. “I can’t speak highly enough of the people on the other side,” Ballard says. With the help of a JCK grant, MJSA is preparing a “plain English” version of the new rules, and given the multicultural character of the industry, there may be a version in “plain Armenian.”

Not everyone is happy with the final product. What some see as taking the views of an industry into account, others view as kowtowing to an interest group. The head of the Los Angeles firefighters union, Kenneth Buzzell, told the Times the new guidelines were “a political solution that will cut [manufacturers] some slack from the fire code.” Critics called the zoning arrangement “[risky] to public safety,” noting that the law generally restricts companies that use lethal chemicals to small buildings to ensure easy access by rescue workers. Ballard counters: “I don’t think the fire department would have signed off on this unless public safety was adequately addressed.”

On the industry side, cooperation or not, manufacturers are hardly welcoming the army of inspectors due to tour each office in the next few months. Initial visits are designed to be “friendly,” with inspectors issuing warnings about what needs to be changed, but the formal follow-ups could include citations.

While Wenslow admits some companies and building owners will have to fork over real cash to make changes, in many cases improvements will save money, because manufacturers will be able to reclaim more dust and shavings. “Many times you are just talking about modernizing your facility and processes,” she says.

Fronjian says he’s tried the new systems and found them cost effective. “The difficult part is that you become used to doing things in a certain way, and now everything has to be changed,” he says.

The new rules are forcing people to take a hard look at how they do business. “It’s a change in attitude from saying, ‘I’m just going to do it like my father did it,’ ” Ballard says. Manufacturers will have to consider factors such as UL listings, he adds, “rather than automatically going for the cheapest piece of equipment possible.”

But awareness of the new rules’ implications may not be universal among manufacturers. “We had a meeting recently and over 200 people showed up,” Marquart says. “But there are more than 3,500 companies that will be impacted by this.”

MJSA expects that other cities and states will follow California’s lead—which could mean jewelry manufacturers throughout the country soon will have a new suite of rules to follow.

“This is the seventh industry that I’ve represented, and I’ve learned that Los Angeles and the state of California are usually the first to impose new health regulations,” says Marquart. “I fully believe New York, Miami, and Dallas will be studying these new rules.”

Even if that happens, says Wenslow, there is nothing to fear. “Ultimately, this will improve the lives of a majority of people, as there is a cost benefit to many of the upgrades,” she says. “As an industry, we have a responsibility to do business safely and ethically. And it will be a lot easier for people to comply with the rules, because at least now we know what to comply with.”