Celluloid Dreams Nearing Reality Amid Eco-Opposition

LOS ANGELES Mayor Richard Riordan (R) says it "sends a message to the world that Los Angeles is back." Gov. Pete Wilson (R) says, "to say I'm pleased and proud would be a terrible understatement...."

But some environmentalists and native Americans are crying out: "Don't tread on us."

The "it" that has angered some but put smiles on most recession-weary politicians here is the first major, Hollywood film studio to be built in 60 years. Announced last month by three of the biggest names in entertainment - Steven Spielberg, Jeffrey Katzenberg, and David Geffen - construction on the 100-acre studio campus is scheduled to begin on oceanfront property here in June.

The trio's 14-month-old company, DreamWorks SKG, will make movies, TV shows, records, and multimedia products from new buildings and refurbished airplane hangars once used by billionaire Howard Hughes.

"The symbolism of this for Los Angeles at this crucial moment cannot be overstated," says Joel Kotkin, senior fellow at the Center for the New West in Denver. There has been an exodus of Hollywood film production to other locales in recent years, and many had speculated that DreamWorks would settle in Seattle, Phoenix, or elsewhere. Now that the group has chosen L.A., Mr. Kotkin says, "it signals that not only will the city remain a world hub of entertainment but will stay at the cutting edge of the new digital era whose companies might have migrated elsewhere."

The high-profile threesome first turned heads at the end of 1994, when they announced they would pool their resources to start their own studio. The group's first offering, the TV comedy "Champs," produced from Amblin Entertainment headquarters on the back lot of Universal Studios, airs tomorrow night. But Amblin czar Mr. Spielberg has long pined for larger digs from which to spin bigger dreams.

"When we decided to form a movie studio, I realized we had to have a physical studio," Spielberg said last month. "The legacy of Warner Bros., Universal, MGM, Paramount ... has a direct connection with the real estate upon which rests their moniker. I'm old fashioned.... I can't make movies in a 45-story office building in downtown Urbania."

The city is said to have granted the largest-ever incentive package - close to $85 million in tax and other breaks - which angered some. And because the new complex will occupy acreage that was once prime wetlands, a small coalition of environmentalists is trying to halt the project, charging that endangered species are threatened. Some Indians also have claimed the land was once sacred burial grounds.

A coalition of some 26 groups, known as Save Ballona Wetlands, intends to file suit as early as this week. "This will amount to the paving over of the last open space in Los Angeles Basin," says the group's president, Rex Frankel.

But because some long-established environmentalists have embraced the project and a group lead by Mr. Frankel lost a similar suit years ago, observers say opposition to the site will not prevail.

"We feel DreamWorks will be the economic engine that will make restoration possible," says Ruth Lansford, president of the long-established group Friends of Ballona Wetlands.

TO make the new complex possible, DreamWorks SKG became partner in a larger, 1,087-acre development with a real estate firm and the land-owning legacy of Hughes. The property will contain 13,000 homes, parks, 260 acres of restored and preserved wetlands, schools, stores, and restaurants.

Some in the film industry are concerned that though entertainment resources are staying in California, they will shift out of historic Hollywood, 30 minutes inland from the chosen site.

"Despite the good news of this, there is a growing imperative for [Mayor] Riordan to halt the decline of old Hollywood," Kotkin says. "Other communities have become more business friendly and are leaving them in the dust."