Disney housing victory in doubt

First there was the party, then came the hangover.

In the same week an invitation-only party was held to celebrate Disney’s recent victory over a developer who wanted to build housing in the city’s resort district, the City Council was looking into reopening debate on the matter.

SunCal Cos., the developer that proposed the 1,500-unit project that included 225 low-cost units, contested last week’s vote on grounds that Councilwoman Lucille Kring should have been cleared to vote on the proposal.

Kring would have been the swing vote on a 2-2 council split that ultimately killed the plan. She abstained after Disney attorneys raised the issue that a wine bar she planned to open nearby could affect her ability to vote objectively.

In a late-hour letter, Disney attorneys cited a 2001 case in Truckee, Calif., in which a council member was advised not to vote on a housing project because it was within three miles of his wine and cheese shop. It was determined that he could receive financial benefit from an influx of new customers.

Anaheim City Atty. Jack White advised Kring that she could face criminal or civil repercussions if the Fair Political Practices Commission determined the Truckee case pertained to Anaheim.

White said he stood behind his counsel to Kring.

“My goal is always to protect council members from any allegations of wrongdoing or conflict of interest,” he said. “You read all the time about government officials having fines levied against them or officials being charged with conflict-of-interest crimes.”

White has asked the FPPC to formally determine whether Kring should have been permitted to vote on the SunCal project or allowed to vote on any other development near the wine bar she plans to open in the nearby GardenWalk retail complex. If the FPPC rules that Kring’s bar poses a conflict, White said it could have “broader ramifications” on future council members who own businesses in town.

“It would be something we’d have to apply evenly to everybody,” he said.

One of the key issues in the Truckee ruling was whether the proposed housing development would increase the wine and cheese shop’s revenues by $20,000 or more a year. White said that the $20,000 figure would also be a factor in Kring’s situation.

White said the council would probably vote on March 20 whether to rehear the zoning change. By then, he expects the FPPC to have offered guidance on whether Kring’s potential wine bar presents a conflict of interest.

If three council members agree to rehear the issue, White said the housing matter would probably come back to the council within 30 days. Council members Lorri Galloway and Bob Hernandez have indicated they would vote for a new hearing.

“Disney did not win,” Galloway said. “It was by default that the vote failed. I want there to be a clear win or a clear loss and a fair vote. With these last-minute tricks, it just seemed devious.”

Councilman Harry Sidhu said he would vote for a new hearing if the FPPC determines Kring has no conflict. Kring said she would wait for the ruling from the FPPC and added that she had not determined how she would vote in a new hearing.

“I have questions for both sides, and I did not have the opportunity to ask them,” she said. “I’m on the fence.”

The potential of another hearing had to dampen the spirits of Disney, whose president attended a private reception Tuesday at the Grand Californian Hotel hosted by the Anaheim Chamber of Commerce and the Anaheim/Orange County Visitor & Convention Bureau. According to the invitation, the affair was held to thank those who publicly supported their position to defeat the residential project.

White said it was not unusual for someone to ask for a rehearing, but he said he could not recall the council granting one during his 22 years at City Hall.

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dave.mckibben@latimes.com