No Script for Hollywood as City Formation Makes Gains

By HOWARD FINE

Staff Reporter

What would the city of Hollywood look like if voters approve the proposal to secede from L.A.?

For one thing, it would instantly become the fourth or fifth largest city in L.A. County (depending on whether the San Fernando Valley secession effort is successful). The biggest industry would be tourism and related retail businesses, followed closely by the motion picture industry.

But after those barebone statistics are laid out, there are many more unanswered questions about how this new city would operate.

“Unlike the Valley, which has had years to germinate the idea of secession, this proposal has come about rather hastily, as if it was piggy-backing on Valley secession,” said Raphael Sonenshein, professor of political science at California State University Fullerton.

According to the Local Agency Formation Commission, which last week placed Hollywood secession on the ballot, a new city would generate some $21 million more in revenues than it currently receives in Los Angeles city services. As part of the state requirement that any area breaking off from a city must be revenue neutral, Hollywood would have to pay an initial $21.3 million to the remaining City of Los Angeles. The amount would decline 5 percent a year over 20 years until it reached $0 in 2022.

The corresponding “alimony” payment for a new Valley city would be much higher: starting at $128 million next year and decreasing 5 percent each year until 2022. This figure was revised upward from an initial payment amount of $55 million after L.A. city officials vehemently objected to that lower figure.

Like a new Valley city, little would change initially. For the first 120 days from the July 1, 2003 start date, Hollywood would be required to implement all of the ordinances on the books in the city of L.A. The new city would also contract with the remainder of L.A. for most of its services during a year-long transition period (from July 1, 2003 to June 30, 2004).

Then the new Hollywood city council would decide how to provide services for its residents and businesses with its estimated initial budget of $187 million. It could take certain city services in-house or contract with other jurisdictions like the county or with the private sector.

Forming a government

Gene La Pietra, co-chair of Hollywood VOTE, the group formed to push for Hollywood secession, said it’s likely the new city would choose to contract with the Los Angeles City Fire Department for fire services and the Los Angeles County Sheriff’s Department for police services. Other services, like building inspections and park maintenance, likely would be taken in-house.

As with the Valley, secession proponents say the new city would find ways to provide these services for less money than the current city of Los Angeles spends. But opponents point out that savings aren’t guaranteed and may be harder to achieve than secession proponents believe.

The new Hollywood city would differ from a new Valley city in several respects.

First, because of its smaller population, there would only be five council members, not 14 as in the Valley. And those members would be elected at large on Nov. 5, with the top five vote-getters making it onto the council. Once the new council meets, La Pietra said it could decide whether to draw up council districts.

Unlike the Valley, where the new mayor would be elected with the new council members on Nov. 5, the new mayor of Hollywood would be chosen from among the five council members with a vote of the council, much as is done in small cities throughout the region. The council also would appoint other top city staff, including the city manager, city attorney and city clerk.

“In a city this size, with this proposed structure of government, the quality of the management team is absolutely key,” said Steven Frates, senior fellow at the Rose Institute of State and Local Government at Claremont McKenna College. “The mayor tends to be more of a figurehead, with the city manager and the council holding the real power.”

In recent years, there has been a trend in small cities of switching to elected mayors; that will be another issue the new council would have to grapple with.

Then there’s the question of where City Hall would be.

La Pietra said no decision has been made on a site, but that it would likely be in leased space on Hollywood Boulevard. One of the top candidates: TrizecHahn Corp.’s Hollywood & Highland project. La Pietra said he has had informal discussions with TrizecHahn officials on the idea.

“Here’s a project where the parking lot is losing tons of money and many of the restaurants and shops inside the mall aren’t doing so well,” La Pietra said. “Putting City Hall there would boost the fortunes of both.”

Inheriting debts

That could get tricky because LAFCO last week ruled that the city of Los Angeles would retain tax revenues and bond obligations for the Hollywood & Highland project.

The new city would inherit the debts and revenues associated with other redevelopment projects within its borders. Just blocks down the street from Hollywood & Highland, for example, is the Hollywood Galaxy project, which by most accounts has been an abject failure.

Secession proponents concede that those projects have been unsuccessful. But a new city would have to take those same projects and figure out how to make them work, or risk losing millions of dollars every year.

“We believe we can turn them around,” La Pietra said. But he was short on specifics.

The new Hollywood city could face an even tougher hurdle that the proposed Valley city would not likely face: several communities within its boundaries want out. Neighborhoods like Beverly-Wilshire and (around the Farmer’s Market area) and Hancock Park successfully lobbied LAFCO to have the original southern boundary moved north from Wilshire Boulevard to Melrose Ave.

Other districts or groups, such as the Los Feliz Business Improvement District and the Franklin Hills Neighborhood Association, are trying to get out of the proposed Hollywood city. In their arguments before LAFCO last week, L.A. Mayor James Hahn and others pointed to these neighborhoods as evidence of significant opposition to secession.

“A new Hollywood city would be starting up with a whole bunch of people who don’t want any part of that city,” said Andrew Glazier, co-chair of the newly-formed Hollywood secession opposition group known as Hollywood and Los Angeles as One, or HALO.

Unlike in the Valley, which has long had a distinct geographical identity, much of Hollywood is right in the middle of L.A.

“It’s much harder to unpack relationships between Hollywood and Los Angeles than between the Valley and Los Angeles,” Sonenshein said. Add to that the fact that, until a couple months ago, many people in Hollywood didn’t take the idea of Hollywood secession seriously.

La Pietra said that even after the Nov. 5 vote, any community that wants out could still petition LAFCO to be removed from the city. “Any community that demonstrates it wants out will be able to leave; what’s more, we will let them,” La Pietra said. “We don’t want to govern any area that doesn’t want to be governed by us.”

Finally comes the matter of who gets the famed Hollywood sign.

The world-famous landmark has become enmeshed in a tug of war between secessionists and L.A. city officials. Hollywood city proponents want jurisdiction of the sign that would bear the new city’s name. L.A. city officials contend that the sign, which is in Griffith Park, is well outside the borders of the proposed Hollywood city and should remain with Los Angeles. LAFCO sided with secession proponents and said the sign should go to the new city. But it’s likely no one’s heard the last of that fight yet.

What About Universal?

With secession movements threatening to cleave Universal Studios’ sprawling 415-acre property into three municipalities, the unit of Vivendi-Universal SA has secured a change shifting two parcels into the proposed San Fernando Valley city.

Universal officials requested that the maps be redrawn after the Local Agency Formation Commission recommended boundaries dividing portions of Universal City now in the City of Los Angeles between prospective Valley and Hollywood cities.

The change would affect a portion of the roughly 30 percent of Universal City in the City of Los Angeles. The balance, in an unincorporated area of L.A. County, would not be impacted by any successful secession.

A Universal official who declined to speak for attribution said the entertainment giant was concerned about the prospect of having to deal with three separate municipal governments if secession bids, to be put to voters on the November ballot, succeeded. The company has not taken a public position on either secession drive.

Most of the revenue-generating portions of Universal City, including Universal Studios Hollywood and CityWalk, are on county land, although two hotels and several restaurants and office buildings are in the city.

The two parcels shifted to the Valley have minimal development and are not expected to have an impact on the finances of a new Valley city.

Universal’s request for the border change was accepted by LAFCO and agreed upon by leaders of the Valley and Hollywood secession movements earlier this month.

Gene La Pietra, president of Hollywood VOTE, the group leading the secession drive, said that despite Universal’s close connection to Hollywood, his group did not oppose the request.

“You don’t pick fights with people when you are going through a process like this. You need allies, not enemies,” La Pietra said. “We still need (people in the Valley) to vote. I hope we will win a few of those people over by doing the right thing.”

Darrell Satzman