Hollywood Sprawl; Ballona wetlands in Los Angeles, California
by J. William Gibson
The Nation
March 1, 1999
Vol. 268, #8; p. 16

THE BALLONA WETLANDS ARE THE LAST OPEN SPACE IN THE LOS ANGELES BASIN. INSTEAD OF TRYING TO SAVE THEM, POLITICIANS ARE GIVING SUBSIDIES TO DEVELOPERS.

On the far southern fringe of Los Angeles, where the city meets the Pacific Ocean near Marina del Rey, lie the Ballona wetlands and flood plain. Anyone standing on the Westchester bluffs above them can see the Santa Monica Mountains twenty miles to the northwest and the San Gabriel Mountains twenty miles to the north. But in all that vast landscape, home to more than 3.5 million people, the 1,087 acres below the bluffs are the only large parcel of private land left on the Los Angeles basin floor. Urban sprawl has taken everything else.

Ballona doesn't have the pristine look of rural wilderness. On its eastern end is an abandoned aircraft-manufacturing plant once owned by Howard Hughes. To the west is a natural gas storage field, another legacy from World War II. However scruffy, Ballona is the last large saltwater marsh and upland ecosystem in Los Angeles County. Coastal developments, from Hollywood moguls' estates in Malibu to the 6,000 boat slips at nearby Marina del Rey to the commercial harbors at San Pedro and Long Beach, have led to the draining and filling of 93 percent of the county's original wetlands.

Though the tidal flow at Ballona has been greatly reduced by surrounding developments, water still gets through rusted flood-gates to support the marshlands. Great blue herons routinely roost in Ballona's eucalyptus groves. Egrets, geese and ducks use it as a resting place and feeding ground on their annual migrations up and down the Pacific Flyway from Canada to South America. In years past, biologists have spotted numerous endangered species at Ballona, including the California brown pelican, California least tern, savannah belding sparrow and the southwest willow flycatcher. After all, they have no place else to go.

If Ballona were somewhere other than Southern California, politicians might well be competing to save it with rival financial schemes and legislation. In recent years, several federal agencies, including the US Army Corps of Engineers and the Federal Emergency Management Agency, have started offering money to buy wetlands as a form of flood control and a way to cleanse toxins and protect wildlife. Hundreds of millions are now being spent to buy up farmland and restore the Florida Everglades.

But Ballona has had no such luck. After three tense years of negotiation and dealmaking, in November DreamWorks SKG, the film studio formed by Steven Spielberg, Jeffrey Katzenberg and David Geffen in 1994, signed an agreement to build its headquarters on the Ballona property. If constructed, it will be the first new major studio built in LA in more than fifty years. With DreamWorks in place as anchor tenant (with an option to become a 9 percent partner), the developer, Playa Capital, plans to move ahead with the largest urban development in US history, the massive $ 6-8 billion Playa Vista project, with 13,000 residences for 30,000 people, more than 5.5 million square feet of commercial space for 21,000 workers, a 1,050-room hotel, a marina for some 750 boats, an elementary school, a fire station and a police substation.

Over eighty opposing groups, ranging from national organizations such as the Sierra Club and the Surfrider Foundation, to regional and local entities such as the Wetlands Action Network and California Public Interest Research Group (CALPIRG), have fought the proposed development. Organized in 1995, the Citizens United to Save All of Ballona coalition has argued that destroying LA's last open space and replacing it with a project that will generate more than 200,000 car trips and ten tons of air pollution each day will cause irrevocable harm. While the coalition accepts development of the roughly sixty-acre Howard Hughes aircraft plant as a potential new home for DreamWorks, it wants the remaining, unpaved 1,030 acres brought into the public domain and saved as a nature preserve and park.

As Playa Vista moves into the first phases of grading and construction, the opposition's hopes of derailing the project rest on the outcome of a major federal lawsuit. Three member groups of the environmental coalition charge that the Army Corps of Engineers violated the National Environmental Policy Act by issuing permits to dredge and fill wetlands without adequate environmental reviews. In June 1998 a federal district judge in Los Angeles revoked the developer's dredge-and-fill permits and ordered a full environmental evaluation. But he only required construction to be stopped on sixteen acres of federally delineated wetlands, not the surrounding uplands, even though his fifty-three-page ruling says that their fates are "inextricably inter-twined" and "functionally interdependent."

Both sides have appealed the decision to the Ninth Circuit Court of Appeals in San Francisco. The environmental groups want the appeals court to expand the injunction prohibiting construction activities to the entire property while a full environmental impact statement is prepared, which could take up to two years. The Corps of Engineers and Playa Capital want the dredge-and-fill permits restored. They plan to handle stormwater runoff for the entire project using a site formerly occupied by nine acres of salt-water marsh. Without the permits, the developer must reconfigure the project. The complicated real estate deal at Playa Vista could unravel then, if the environmental plaintiffs have their district court victory sustained or, better yet, the appeals court expands the injunction to greater acreage. A decision is expected this spring.

Meanwhile, Los Angeles's political establishment celebrates the new DreamWorks/Playa Capital agreement. To many Democrats and Republicans, Playa Vista represents the future of the city and that of their political careers. Traumatized by the deep economic recession in Los Angeles during the early nineties, a number of politicos have come to see a corporate marriage between the entertainment industry and computer technology--which Playa Vista embodies--as Los Angeles's salvation.

Local and state officials have offered DreamWorks and Playa Capital a staggering array of subsidies to build their new magic kingdom. In 1995 Governor Pete Wilson allocated $ 40 million for roadwork, while the City of Los Angeles provided $ 70 million in tax credits and infrastructure support. The city agreed to issue $ 410 million in special district bonds to help the developer pay for Playa Vista's infrastructure. These offers were tabled after a 1995 deal with the original developer, Maguire Thomas Partners, went bad. Now that DreamWorks and Playa Capital appear to be settling in for good, the subsidies are being revived for approval by the LA City Council. The new developers will receive about $ 110 million in tax breaks, reduced municipal fees and transportation infrastructure. Playa Capital will also be allowed to borrow nearly $ 500 million in below-market-rate loans financed by tax-free state and municipal bonds.

What the establishment hopes this $ 600 million will buy is nothing less than a new economic geography and tax base. Bringing DreamWorks to Playa Vista, supporters say, will attract scores of other high-technology firms working in computers, mixed-media and entertainment to LA's affluent west side. Politicians also hope that the project will ease the city's fiscal woes, a chronic problem since 1978, when Proposition 13 froze property values for tax purposes. New residential and commercial development will escape the strictures of Proposition 13, radically increasing land values and thus generating property tax revenues. And the affluent new residents, workers and visitors in the entertainment and computer industries will yield sales and hotel tax revenues.

At the same time, politicians have benefited enormously from the developers' campaign contributions. One CALPIRG study of campaign donations from 1993 to 1995 found that DreamWorks, together with Maguire Thomas Partners and the major law firm and engineering consultants who worked on the project, gave a total of $ 346,000 to local and state politicians, including a $ 50,000 donation by Steven Spielberg to Governor Wilson months before he allocated $ 40 million in project subsidies. During the 1996 national campaign, Spielberg, Katzenberg and Geffen together gave the Democrats $ 562,000. And in the 1998 California governor's race the three DreamWorks principals each donated $ 50,000 to Democratic candidate Gray Davis.

Besides their personal contributions, the principals also raise money for President Clinton and the Democratic Party--in the 1996 election cycle Geffen alone raised $ 10 million. When Clinton visits Los Angeles for fundraisers and other events, he stays in Malibu at their homes. In short, the Playa Vista developers and DreamWorks have offered willing politicians a ride on a glamorous gravy train.

The developers' largesse has given them profound, if indirect, political influence. Wendy Wendlandt, CALPIRG's associate director, argues, "With Playa Vista having built up support in the political establishment, it was easier for the Corps of Engineers to do a slipshod job in reviewing the impacts of the proposed project." And the role of DreamWorks' major players in supporting nonprofit organizations appears to have caused a split in LA's environmental community. Several prominent environmental groups--including the American Oceans Campaign, Heal the Bay and the Natural Resources Defense Council--have not opposed the development, a position that State Senator Tom Hayden, for years Playa Vista's principal political foe, decries. "They think of Spielberg as a good guy and [DreamWorks] SKG as a million-dollar contributor to liberal causes," he says. "It simply makes environmentalists uncomfortable to get into a fight with these fellows."

The divisions among LA's environmental groups have helped Playa Vista's developers and DreamWorks present the mega-development as an ecologically beneficial plan. In 1990 the Friends of Ballona Wetlands, the first organization to challenge the early proposals for Playa Vista back in the eighties, made a settlement agreement with then-developer Robert Maguire. The Friends proudly announced that 190 acres of saltwater marsh had been saved, and the developer agreed to contribute $ 10 million to restore the wetlands. It sounded spectacular, but the deal was gravely flawed. Delineated wetlands are protected by federal law--the developer had no legal right to build on 188 acres in the first place. Moreover, the Friends signed a legal agreement saying that unless Playa Vista received permits to develop its full master plan on the other 900 acres at Ballona, no moneys for restoration would be allocated. The Friends, required by a 1994 supplement to their settlement agreement to testify for the developer at public hearings and media events, became a proponent for Playa Vista. At the same time, Maguire Thomas Partners and the city agreed to shift the $ 10 million commitment to wetlands restoration over to the roster of infrastructure expenses to be covered by the special district bonds.

For the past five years Playa Vista developers have repeatedly presented themselves as trustees for the public good. Press releases and local community-newspaper ads routinely announce, "Playa Vista is legally and morally committed to restoring the Ballona Wetlands." They even claim that "over half of the total acreage of our property (more than 500 acres) will be open space," a figure derived by counting the already protected wetlands, a proposed marina, the Westchester bluffs--which are nearly vertical and unfit for development--and eighty-two acres of the Ballona Creek concrete flood control channel.

Besides its astute greenwashing campaigns, the developers and DreamWorks have made the project highly attractive to organized labor. DreamWorks is a union shop. All the construction jobs at Playa Vista are to be union jobs as well. ULLICO Inc., manager of many trade union pension funds, is also an investor in Playa Capital and is expecting an excellent return on its investment.

In recent months the developer has reached beyond its labor constituency to portray Playa Vista as the cutting edge of contemporary liberal social policy. On November 20, Los Angeles City Councilwoman Ruth Galanter (a longtime Playa Vista advocate who was originally elected to the City Council on an antidevelopment platform in 1987) and Peter Denniston, president of Playa Capital, announced that building Playa Vista was the solution to a recent series of gang killings in west Los Angeles and Santa Monica. Playa Capital committed 10 percent of the Playa Vista construction jobs to "at risk youth," meaning gang members, former gang members and youths with jail records. Senator Tom Hayden shared the podium with them, calling Playa Capital's offer "a way to cement a cease-fire agreement between warring gangs."

To Hayden it was time to walk a thin line between opposing Playa Vista and trying to get the most out of the developer, assuming it would be built. Backing construction jobs for barrio and ghetto youth, Hayden reasons, would create some return for the massive public subsidies. Despite his endorsement of the jobs program, Hayden maintains he still opposes Playa Vista, pointing out that the affluent west side of Los Angeles is hardly the best place to build a huge new project: "It's a new beach town, a pattern of development that perpetuates race and class divisions. The people who will live there are going to be middle-class and up. Had it been built in the middle of the city, it would have had a different complexion. The barrio and the ghetto continue unfazed by this development."

Most of the social justice movement in Los Angeles feels a similar ambivalence and is now focusing on the issue of what the public can get in return for millions in subsidies. Anthony Thigpenn, executive director of AGENDA, an anchor organization in the Los Angeles Metropolitan Alliance, a coalition of about fifty community organizations and labor unions, posed the question: "Are these subsidies going to address major economic issues in the region, or are they a free ride to corporations that are already doing well? The verdict is still out." Thigpenn echoes Hayden's concerns about the location of the development. "The environmental concerns are legitimate concerns. We'd also much prefer development happen at a more central place, near communities in need such as South Central or East LA."

But what should happen is not political reality. "What kind of power can we in the progressive movement bring to bear?" Thigpenn asks. Metropolitan Alliance's strategy is to push for a DreamWorks-sponsored training program in LA-area community colleges for poor youth and to press Playa Capital for more jobs. "Ten percent of the construction jobs is not enough," says Thigpenn. "We want 10 percent of the regular jobs created at Playa Vista to be distributed to communities suffering from high levels of unemployment and poverty." Moreover, Metropolitan Alliance wants ironclad guarantees that the corporations receiving public subsidies actually pay for the training and jobs.

But the developers have not offered 10 percent of all jobs, nor are they absorbing all the costs of training and employment. According to Michael Dieden, Playa Vista Jobs' acting executive director, the fifteen at-risk youth who were put to work in 1998 were first trained by community-based organizations in life-skills, graduate equivalency classes and pre-apprenticeship classes at the organizations' expense. Playa Capital pays for each apprentice's initiation fees into a building trades union, the first month's union dues and the costs of tools and work clothes. An estimated 75-100 youths will go through the program in 1999 and 300-500 in subsequent years. During 1999 the entire salaries of twenty will be paid for by a federal Housing and Urban Development grant, just the kind of cost shifting Metropolitan Alliance fears.

The question of what the public gets for subsidizing Playa Vista also needs to be asked about the project's latest foray into social policy, "affordable housing." On December 9 the Los Angeles City Council forwarded to Sacramento Playa Capital's request for $ 87 million in tax-free federal housing bonds to subsidize the building of 417 units of low- and moderate-income apartments amid its 13,000 upscale apartments, condominiums and luxury homes. To make Playa Vista look better, the developer put all 417 lower-rent residences in two apartment complexes totaling 910 units and made them the first residences to be built in the entire 13,000-residence project. Moreover, Playa Capital would be taking a healthy chunk of LA's entire federal allotment in apartment construction subsidies. The 417 affordable units at Playa Vista would be subsidized at more than $ 208,000 per unit. The next-highest subsidy per apartment among the thirty-eight projects on LA's list runs just over $ 82,000 per unit; most are much lower.

To Playa Vista's supporters, questions of costs, subsidies to wealthy developers and the whole issue of whether the development should be built on the last open space are irrelevant. Councilwoman Ruth Galanter exclaimed at a City Council hearing, "This is not about Playa Vista but about affordable housing on the west side." Bo Taylor, leader of Unity One, an outreach organization involved in the Playa Vista Jobs program, spoke in favor of Playa Vista housing bonds by asking, "Are we gonna save the wetlands with the wildlife or are we going to try to do something to keep these youths from killing each other and killing innocent victims, kids?" In other words, Ballona must die so that others will live--an archaic kind of blood sacrifice of the land so the gods will help humans prosper.

The social justice progressives have some difficult decisions to make about whether to support these subsidies. Anthony Thigpenn of Metropolitan Alliance argued for a delay in approving the housing bonds, saying that "all of the subsidies must be evaluated in terms of citywide impacts." By the alliance's calculations, using the estimate or a $ 90 million direct subsidy to DreamWorks and Playa Vista, the City of Los Angeles was spending the equivalent of job training for 15,000-30,000 people, childcare for 23,000, support for 200 youth programs and 60,000 school computers. Or, as Hayden quipped, "It's a hell of an inefficient way to house or hire a homeboy."

Metropolitan Alliance's negotiations to obtain 10 percent of all jobs face an early April deadline; at that time the LA City Council will convene a hearing on a $ 35 million subsidy package for Playa Vista. Unless DreamWorks and Playa Capital agree to its conditions, Thigpenn says, "massive public pressure needs to be organized to stop these subsidies from being approved by the City Council." CALPIRG's Wendlandt and the other environmental activists in the Citizens United coalition have already made up their minds to oppose the package. After all, the public money offered to DreamWorks and Playa Capital is far greater than the estimated $ 100 million Playa Capital and its investors paid to buy the !and.

And, of course, the project's opponents anxiously await the appeals court ruling. "If we win at the Ninth Circuit," Wendlandt contends, "there's a strong chance the deal will fall apart and we will then have a real opportunity for Los Angeles to change course." If Playa Vista is stopped, the repercussions will be felt across the United States. "People are beginning to see open space gobbled up," says Wendlandt. "The more we can demonstrate that we can stop high-profile developments, the more it helps us all over the country."

J. William Gibson's most recent book is Warrior Dreams: Paramilitary Culture in Post-Vietnam America (Hill and Wang); he is also the author of The Perfect War: Technowar in Vietnam (Atlantic Monthly). A sociology professor at California State University, Long Beach, he lives in Los Angeles.