SOUTH GATE — Despite a hiring freeze, officials of the cash-strapped city next month will start the search for an economic development manager.

Steve Lefever, director of community development, said names and résumés will be sought from eligible applicants to fill the vacant number two position in his department.

At a special meeting Nov. 30, the City Council decided to spend some money to hire a new administrator in order to make some money by bringing needed development into the city.

Lefever, in a written report, said the cost of an economic development manager would be about $125,370 a year with benefits. The salary would come from the Redevelopment Agency budget, which is separate from the general fund spending plan.

The decision to hire extra help to bring in development came after a review of past, mostly unsuccessful efforts of staff and hired consultant — Kosmont and Associates — to find interested developers or those with sufficient financial backing during the recent economic downturn.

“While the city will benefit from having an additional [development] position, it is important to note that having [an] individual on staff will not suddenly create new development opportunities,” Lefever said in his report.

Stressing that the new manager would not be a replacement for the consultants, Lefever said the manager “may certainly assist Kasmont and Associates but could not replace them at this critical time, especially given their specialized expertise which the city could not afford to replicate with full-time staff.”

Lefever said the manager would be helpful in such areas as marketing and rebranding the city’s image and to reach out to foreign companies, something current staff has not had time to do.

“This position will also relieve the community development director of some of the day to day functions that require his attention,” City Manager Ron Bates said.

“There is no question that the community development department needs more staff,” Bates said in the report.

He noted that neighboring Downey has 10 to 15 people in its economic development and planning departments to just three full-time staffers in South Gate.

Lefever and Bates noted that while staff and Kosmont have brought in plans for 800,000 square feet of new retail and service uses and 210,000 square feet of light industrial, few of those projects materialized because of the inability of the developer to obtain funding.

A major example is the El Portal project, a proposed 30.5-acre, 517,000-square-foot commercial center on vacant, city-owned land at Firestone Boulevard and Atlantic Avenue.

The developer, Allied Red Mountain, has defaulted on its loan from lenders for a loss of about $20 million. The City Council recently extended a deadline for construction from Oct. 30, 2009 to Jan. 28, 2010.

Target, one of the interested parties in the development, may become the developer, Lefever said.

El Portal, which translates to the Gateway, was first approved Feb. 12, 2008. It called for a Target store, a theater and a health club.

No building permits have been issued as the developer has said he is unable to meet financial obligations. Target is now seeking to acquire the site and develop it, Lefever said.

Requests for the extension came from the developer and property owner, South Gate Gateway, Target, which plans a store there; and Wachovia Bank, the proposed lender.

If all goes well, work might start next year and some stores may open in 2011, Lefever and Bates said.

Meanwhile, on the east side of town, the owner of the El Paseo Center at Firestone and Garfield Avenue is concluding litigation with the city stemming from issues of the Albert Robles administration some seven years ago. Robles, the city treasurer and assistant administrator; and three council members were recalled from office in January 2003.

Remodeling of the center is planned after the litigation, they said.

Another problem is at the Atlantic Plaza, second largest approved center after El Portal. The developers have yet to find a tenant, they added.

Lefever noted that his staff has contacted some 50 well-known businesses about developing in South Gate and is working with Los Angeles County on making the current South Gate Civic Center on California Avenue north of Firestone the site of a planned courthouse, with nine to 15 courtrooms.