Postscript : Attack on Hostel Leaves Burning Questions in German Village : Months later, the community is accused of hiring arsonists to thwart an influx of Gypsies.

Nestled in the wooded countryside that sprawls south of Berlin, this tiny village has long served as an escape from urban stress.

“A quiet spot for people to take a breath,” summed up the community’s mayor, Ute Preissler.

With one store, no post office, a public phone that doesn’t work and a bus service to the world outside that’s down to twice a week, about the only excitement for the village’s 260 residents is a boat ride on the nearby lake and the occasional schnapps at the community’s lone watering hole.

At least, that’s the way it was until the secret leaked out.

That was in August, when a Berlin newspaper reporter ripped open the community’s secluded little world, exposing it to the glare of the global spotlight.

The picture was not pretty: Otherwise decent, upstanding burghers stampeded by fear at the prospect of having 80 foreign asylum-seekers dumped in the midst of their tranquil existence.

The most chilling accusation--that to preserve their quiet life, villagers 11 months ago paid right-wing extremists to burn down a converted youth hostel where the foreigners were supposed to live--remains the subject of an urgent police investigation. Tales that the villagers celebrated the deed at the local pub are also still unsubstantiated.

But the fact that residents were consumed by fright at the prospect of the foreigners arriving requires little additional proof. Although they tend to look away when they speak, few in the village deny that now.

Indeed, in the emotion of the moment, well over half put their names on a petition denouncing the local county government’s decision to send the foreigners here and expressing worry about the safety of the village’s women and children.

While the petition contained language that Mayor Preissler now describes as “a bit hysterical,” even seemingly reasonable residents added their names.

“I signed it, even though I wasn’t against them (coming),” said Marianne Walzer, whose neatly furnished home looks out on pleasure boats moored on a nearby waterway. “Everyone was worried, and I didn’t want to stand in the way.”

Few also dispute that there was a sense of relief when the converted hostel burned to the ground shortly before the foreigners were due to arrive.

“We certainly weren’t sad that the problem had been solved, at least for the moment,” Preissler said.

The word problem used to describe the asylum-seekers reflects a mind-set that exists far beyond this little village. To most Germans, the foreigners streaming into the country from southeastern Europe and the Third World are undeserving, unpleasant and unwanted.

But what neither the mayor nor most others can bring themselves to believe is that the good villagers of Dolgenbrodt willingly became instigators of arson and then celebrated the plot.

“If that were true, it would be terrible,” Preissler said. “I can’t put my hand in fire and swear this didn’t happen, but I can’t believe it, and so far there is no evidence that money was collected.”

As for the morning-after celebration, residents claim that volunteer fire department members traditionally get a free breakfast at the pub if they are sent out during the night and that other villagers may have dropped by just to learn what happened.

Sure, they say, a few schnapps were downed; it was cold that late autumn morning. But, they stress, there certainly was no celebration as described last month by the Berlin newspaper Tageszeitung.

The Tageszeitung article had the impact of a bombshell on the village. It revived a long-dormant police probe into the fire and launched a high-priority search for evidence of payoffs. And it brought in a swarm of television crews and reporters.

Since that article appeared, Preissler has received death threats, vacation bookings in the area have been canceled and the village has been lumped together as a symbol of xenophobic hate with the names of other German towns such as Moelln and Solingen, where foreigners died in arson incidents.

While villagers are largely confused and resentful of the fuss, it’s not hard to understand. Although no one died at Dolgenbrodt, events here in many ways are far more disturbing than Moelln or Solingen. In those cases, it was a few extremist youths, thriving in an atmosphere of passive xenophobia, who carried out arson attacks. In Dolgenbrodt, an entire community stands accused.

Locals say the problems began when they learned that foreigners coming would be mostly Gypsies from Romania--traditionally among Europe’s most frequent victims of bigotry.

“If it had been four or five families from Bosnia or (ethnic German) families returning from Russia, we’d have welcomed them,” Preissler said. “But so many, and Gypsies. . . .”

Added Walzer, whose husband heads the volunteer fire department that eventually put out the blaze: “As soon as people found it was going to be Gypsies, then they became afraid. Chickens run free around the village, you know.” (It is a common, and ancient, perception in Europe that Gypsies steal.)

After failing to reverse the county government decision, villagers met at the local pub a few days before the fire. According to one of those present, discussions focused on community defense measures. With the nearest police station 14 miles away, residents set up a system of street patrols. Telephone chains were established so that word could be passed quickly through the village in case of emergency.

“The mood was not good,” Walzer admitted.

Among the leaders of this mobilization was the same resident who had helped organize the petition, an electrician named Gerd Graefen. While Graefen isn’t talking to reporters, those who were at the pub meeting say he was extremely agitated and ended his remarks by shouting, “Germany for the Germans!”

“I had to talk like an itinerant preacher to keep the lid on,” Preissler said, recalling the evening.

A few days later, villagers were able to forget their elaborate plans. Between 1:30 and 3:30 on the morning of Nov. 1, 1992, the hostel burned.

Suspecting arson, police arrested a 19-year-old rightist tough, but then released him for lack of evidence. He was the first to claim that money had been offered from the village to destroy the hostel.

But with the police shorthanded and overburdened by the pressures of adjusting to the unification of East and West Germany, the investigation eventually lapsed. There was no public outcry at the time, and the people of Dolgenbrodt resumed their quiet, uncomplicated lives.

The incident had virtually been forgotten until last month’s expose suggested that much of the village had colluded to destroy the building.

The reporter, a young woman named Michaela Schiessl, described how a local resident confessed about the money collection to a friend during a drunken evening shortly after the fire.

In an interview with The Times, the state’s justice minister, Hans Otto Braeutigam, confirmed that the young suspect who was released had told investigators that villagers offered money for the act of arson.

But nearly a month after Braeutigam ordered an urgent investigation into the charges, the local public prosecutor’s office in charge of the case declines all comment and the ultimate question still hangs in the air.

Yes, admitted Preissler, Dolgenbrodt had what she termed “a few strange thinkers,” including one youth active in the region’s skinhead scene. She and other residents noted that the Reichskriegsflagge--a naval flag of Germany’s imperial era adopted by the extreme right--occasionally flew in the village.

“They were just having fun,” insisted Guenter Rossa, a resident retiree. “They didn’t mean any harm by that.”

Searching for reasons to explain the ugly mood in the village just before the hostel burned, the mayor faults county officials for ignoring residents’ genuine concerns and doing nothing to smooth the way. “We were steamrollered,” she said.

Some believe that, if the arson was funded by locals, only a very few took part.

“If (the original suspect) was right, then it would have been only two or three,” Walzer said. “For the sake of the rest of us, I hope they get them.”