Questions Arise : Housing Plan Stalled by Burbank

Burbank City Council put a redevelopment contract on hold Tuesday while the city’s staff investigates a contractor under fire in Los Angeles for what an official in that city described as “irregularities” in development-related bond sales.

The controversy over the Los Angeles project was the subject of a story in The Times Sunday, which reported that two council members and housing officials, among others, had raised questions about a $190-million housing project to be built by Alan I. Casden of Beverly Hills. Los Angeles is to issue bonds to finance the project, which will include some so-called “affordable housing.”

Unanimous Action

Last Tuesday, Burbank council members unanimously awarded a development contract for a 7.2-acre parcel to Casden, who offered to pay $7 million for the land, obtain prompt bond financing and build a 400-unit apartment project. The total cost of the project would be between $35 million and $40 million.

The city has been trying for years to get the parcel developed.

Although council members conceded that some of the criticisms leveled at Casden’s Los Angeles project would not apply to the Burbank parcel, they said they they were angry with their staff for not informing them of the complaints about Casden’s firm, the Casden Co.

‘Pretty Disturbing’

“It’s pretty disturbing when we’ve just voted to give the man a big development in our town,” Burbank Councilwoman Mary E. Kelsey said in an interview before Tuesday night’s City Council meeting.

The council voted 4 to 0 to delay implementation of Casden’s contract for a week and to have the city manager and redevelopment director check into Casden’s work in Los Angeles.

“I’m not questioning any of the developers’ ability to develop the project,” said Councilman Al Dossin. “I’m worried about credibility.”

Last-Minute Lobbying

The council awarded the contract to Casden after last-minute lobbying by two other developers, who offered to match Casden’s price and terms.

City officials said Tuesday that they are concerned about allegations made by Los Angeles City Council members that Casden inflated development costs and chose a financial institution with which he is affiliated to provide cost checks for the Los Angeles city project.

Casden has said that his financial arrangements are “fairly commonplace” and pointed to his firm’s record, saying, “In 25 years and 30,000 apartments, this company has never defaulted on any obligation . . .”

At last week’s meeting, city officials urged the council to pick a developer quickly to avoid jeopardizing financing of the project through the housing bonds, which could be eliminated by pending federal tax legislation.