Agency Ends $1-Million Funding Pact With Builder

An agreement under which the city’s Redevelopment Agency was to lend $1 million to a developer to help build an affordable-housing complex in downtown Fullerton has been terminated.

City Council members, acting in their capacity as Redevelopment Agency directors, this week voted 3 to 2 to end the agreement, even though they were told by an agency attorney that they had no legal basis for doing so.

At issue was whether the 3-year-old agreement signed by the agency and Urban Communities-San Gabriel Partners of Costa Mesa still was valid, since the developer sold its interest in the project to Ajit Development and Investments (ADI) Inc. of Los Angeles.

Agency Chairman Chris Norby and directors F. Richard Jones and Julie Sa agreed with residents who argued that the project would be detrimental to the downtown.

But agency attorneys and staff said that the agreement legally was transferred from Urban Communities to ADI.

During a four-hour public hearing Tuesday night, more than a dozen residents pleaded with the agency to kill the agreement and not be afraid to defend their action in court if a lawsuit is filed.

Project opponents called the planned development “a cancer� and said it was incompatible with the downtown business district.

Though the agency’s funding agreement was terminated, it is unknown whether the project, which received approval in 1994, still could proceed.

It also is uncertain whether ADI or Urban Communities will sue the agency, but agency directors are assuming that some kind of legal action is coming.

ADI owner Ajit Mithaiwala said Wednesday that he and his project partners are considering what their next stet will be. Officials at Urban Communities could not be reached for comment.