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Council OKs Incentives for Playa Vista

Development: Lure of thousands of new jobs prompts L.A. to approve $35 million in tax credits for the project, which will include DreamWorks studio.


Spurred by the prospect that Los Angeles may gain thousands of high-paying jobs, the City Council on Wednesday approved $35 million in tax credits for the massive Playa Vista commercial development, which includes the proposed DreamWorks SKG film studio.

Despite opposition from a group of environmentalists, who called the subsidies "corporate welfare," the council voted unanimously to approve the incentive package, which is based on the promise that 21,000 jobs will be created over the next 30 years.

"This is a project that will provide meaningful, long-term, good-paying jobs," said Councilman Joel Wachs, who has been a vocal opponent of other city subsidy agreements that he thought did not return direct benefits to the city.

Playa Capital, the partnership that already has begun improvements on the 1,087-acre site, will receive rebates on business license taxes, utility user taxes and development fees of $2,700 to $5,737 annually for each non-construction job created by the project. The amount of credit is based on the kind of job.

The partnership also gets an $8-million credit against development fees. The incentive package helped make the development financially feasible, said Peter Denniston, president of the group pursuing the project.

The multibillion-dollar development will include more than 5 million square feet of office and commercial space for multimedia, technology, service and manufacturing firms.

DreamWorks, the studio founded by entertainment executives Steven Spielberg, Jeffrey Katzenberg and David Geffen, will share in the tax credits for the 1,000 employees it plans to have at the studio it will build on 47 acres of the site near Marina del Rey.

The incentive agreement was supported at the council meeting by about 60 members of the County Federation of Labor, the Building and Trades Council and a group of inner-city community activists known as the Los Angeles Metropolitan Alliance.

The alliance won promises from the developers that job training and placement programs would be created to give disadvantaged residents access to employment in Playa Vista.

But a group of environmentalists, including Loyola Law School professor Robert Benson, said the city should not be subsidizing a project that they believe will damage valuable wetlands.

"It stinks because this is a handout of corporate welfare to some of the richest men in the country," Benson told the council. "It stinks because it's an environmental disaster."

Benson was the only opponent allowed to testify to the council Wednesday. Afterward, a half-dozen others who attended the meeting accused the council of railroading the project through without sufficient public input.

The tax-credit agreement was also opposed by the California Public Interest Research Group, which called the subsidies "polluter pork," for their potential harm to the environment.

The environmental group filed a lawsuit Tuesday charging that the project involves destruction of wildlife habitat without proper permits.

However, Councilwoman Ruth Galanter, whose district includes Playa Vista, said the developers are going to great lengths to restore nearby wetlands.

"What we have here is a project that will use private money to create jobs," Galanter said. "It will use private money to restore degraded wetlands."

In a separate action Wednesday, the council voted to establish six community facilities districts to assess Playa Vista developers to pay for roads, sewers, flood control and other public improvements.

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