City Goes Back to Square One After Voters Reject Theaters : Election: Fear of increased crime and perception of land giveaway were major factors in failure of two ballot measures.

It is back to the drawing board for perplexed and disappointed Downey officials after voters this week rejected a proposed downtown 2,500-seat theater complex in a citywide referendum.

The defeat Tuesday of a proposed 10- to 12-screen cinema leaves the city about where it started after three years of recruiting and negotiating with developers: with 2.13 acres of virtually unused city property in the heart of an economically slumbering downtown.

But the show must go on.

Officials said they must revive downtown, but will have to find other ways to do it. They said they would still like a new theater in Downey, but it would be a different project, and almost certainly in a different place.

“We have a need for a movie theater that plays first-run movies,” Mayor Diane P. Boggs said. “We have a downtown we need to market and revitalize. We just need to find something less controversial that the public can buy into.”

Voters turned down two measures needed to move the theater project forward. The first measure would have changed the zoning downtown to allow a theater complex. It lost, 4,534 to 4,127.

The second measure, which sought voter approval of an agreement with theater developer George Krikorian to build the cinemas, lost by a slightly larger margin, 4,683 to 4,020.

Downey residents rejected the proposed development because it was poorly conceived, said Michael Sullivan, a leading opponent. “I felt that the people would see through it,” Sullivan said of the Krikorian agreement. “They did. I’m glad.”

Theater backers said a good project succumbed to a successful campaign that touched on voter distrust of government and tapped into fears, particularly among elderly voters, of higher taxes and crime.

“I think the opposition was pretty skilled at inflicting fear upon the good citizens of Downey,” said Councilman Gary P. McCaughan, a theater supporter.

The city had tentatively agreed to sell the site to Krikorian for $1. In exchange, Krikorian would spend an estimated $10 million to build the theater complex and a 355-space, free public parking garage. The city also would have refunded to Krikorian its share of property taxes generated by the development, an estimated $1.42 million over the 30-year agreement.

The City Council approved the agreement in November. But opponents gathered enough petition signatures to put the development on the ballot and give voters the final say.

Opponents argued that the agreement gave too much to Krikorian. City officials countered that the deal was the best they could negotiate.

“We thought it would help revitalize the downtown and we thought it was a very good business deal too,” City Manager Gerald M. Caton said. “I’m very disappointed.”

A group called Downey Citizens for Common Sense Government formed to coordinate both the petition drive and the referendum campaign against the development. Leader Larry Squire estimated that his group spent about $10,000.

Theater supporters spent an estimated $20,000 getting their message out through mailers, telephone banks and precinct walks.

The campaign against the theater included a series of widely distributed flyers that called the theater plan a giveaway and predicted the theater would lead to higher taxes. Opponents also said the theater would spawn traffic snarls and crime.

Opponent Sullivan said the problem was the specific agreement, more than the idea of a theater.

“It’s the deal that they cut,” Sullivan said. “The size, the location, the dollar giveaway. It’s the deal that I think people were upset with.” Sullivan heads Downey Citizens Against Redevelopment Excesses, a small but persistent group of residents and business owners who have successfully opposed past city-subsidized development efforts, including this one, in court and at the ballot box.

Downey CARES has a following among many residents who distrust the city and see the group as a champion of property owner rights, Mayor Boggs said.

Many officials also credit the influence of the Downey Eagle, a locally based free weekly that began publishing about three months ago. The paper printed arguments from both sides, but editorially opposed the theater.

Boggs said the crime issue scored significantly with Downey’s older residents.

“People were concerned about the attraction of undesirables,” Boggs said. “We have a senior population that is scared of everyone under 40. They think every kid in a baseball cap is a gang member.

“In cities all around us, people are voting for casinos. We voted no for a movie theater.”

Resident Betty Denson, 69, said she believed the theater would lead to more crime. “I’m worried about the type of person in the crowd,” she said. “It’ll be just plain trouble.”

Boggs also accused the theater opposition of portraying the development agreement in a misleading manner.

“The perception of the land giveaway was a factor in many people’s minds,” she said. “I don’t think they comprehended the fact that the developer had to spend $2.7 million to construct a free public parking structure.”

Sullivan insisted that theater opponents deceived no one.

“There was bound to be an increase in crime and an increase in taxes for additional fire and police protection,” he said.

The reasoning worked for voter Diane Pinizzotto. “Nobody should get that property for $1,” she said outside a polling place. “It’s prime property.”

“I don’t like the tax kickbacks,” said Deanna Kuper, explaining her no vote.

Now, the city must decide what to do next. Caton said he will seek council authorization to devise a master development strategy for the whole downtown area, which is about 200 acres.

“I think the concept of a large theater complex in downtown is certainly dead,” he added. The special election cost the city about $75,000. Legal fees to fight an unsuccessful lawsuit against the project cost more than $40,000, and the city spent another $40,000 in consultant and legal fees to put the deal together.

SOUTHLAND ELECTION RETURNS Counting of late and absentee ballots could alter the outcome in some races.

DOWNEY 37 0f 37 precincts reporting. Measure A Shall the city’s zoning be changed to permit a theater complex in the downtown?

VOTE % NO 4,534 52 YES 4,127 48

Measure B Shall the city’s agreement with developer George Kirkorian to build the complex be adopted?

VOTE % NO 4,683 54 YES 4,020 46