Blaze Was Preceded by Long Series of Problems

An intense fire that destroyed an apartment complex under construction in downtown Santa Ana on Tuesday was the latest in a series of problems that has plagued the project almost since its inception.

In 1985, the city and the developer were slapped with a lawsuit seeking to halt the project before it could begin. The suit was settled out of court.

In January of this year, city officials shut down the project for three weeks because of serious structural deficiencies. Last month, the city issued a second stop-work order because of numerous, but less serious, building code violations. That order was lifted just last week.

And the framing contractor on the project, Santa Ana-based Builders Unlimited, has a number of claims pending against the firm for nonpayment of wages, and recently was fined $108,000 by the state for labor law violations, state officials said.

Santa Ana Fire Department investigators on Wednesday combed the wreckage of the construction project for clues to what may have started the blaze, which caused an estimated $6 million damage. But they had not yet pinpointed the cause, department spokeswoman Sharon Frank said, adding that “various rumors and allegations are (being) reviewed.”

Two Report Seeing Fire Start

Two people--a 7-year-old girl and a 19-year-old man--told The Times on Tuesday that they saw some boys start the blaze by dropping a match or cigarette, which ignited a container of flammable liquid. Santa Ana Fire Chief Allen R. Carter declined comment Wednesday when asked if investigators were looking into those reports or into the framing contractor’s labor difficulties.

The 200-unit complex is part of the city’s ambitious program to renovate what a few years ago was a badly deteriorating downtown. The project, which stretches from 4th to 3rd streets and from French to Minter streets, is being constructed by Urban Ventures Inc., a Los Angeles-based company. The main project contractor is Mercantile Builders Inc., a subsidiary of Urban Ventures. Mercantile president Jim Heyward could not be reached for comment Wednesday.

Kevin Wieck, development manager for the project, said he was unaware of any trouble Builders Unlimited was having with the firm’s workers.

But Larry W. Wood, a state deputy labor commissioner in Santa Ana, said 21 claims have been filed since late April against Builders Unlimited by workers claiming that they were owed wages totaling $19,000. Many of the claimants worked at the 4th Street site, he said, and some also listed other job sites where they worked for the same contractor.

Wood said that Builders Unlimited told state labor officials that some of the workers have been paid since the claims were filed. However, officials are still waiting for verification of payment from those workers, Wood said.

Another state Department of Industrial Relations official said the company was fined $108,000 on May 19 for failing to deduct taxes and provide deduction statements to its workers.

“They were treating people as independent contractors,” said Roger Miller, the department’s regional manager. “But if a contractor’s license is required to do the work, then each independent contractor has to have a license. Otherwise, we consider them employees.” Most of the workers did not have their own contractor’s licenses, Miller said. The company has the right to appeal the citation, but the state could seek to enforce the penalty in court, Miller said.

The president of Builders Unlimited is James Ray Hill, according to state records. Efforts to contact him were unsuccessful Wednesday.

Cindy Nelson, director of community development for Santa Ana, said workers began showing up at City Hall several weeks ago asking if there was any way the city could help them obtain their wages. “We tried to put the developer together with the subcontractor to solve it . . . and I haven’t heard anything since,” she said.

Nelson estimated that the total value of the completed project would be about $15 million.

Businesses Damaged

The fire, which erupted about 5:45 p.m. Tuesday, destroyed the wood framing and concrete parking garage of the apartment complex, razed a home on 3rd Street and destroyed or damaged several businesses on 4th Street.

The spectacular blaze, which sent flames shooting high enough to be seen five miles away at John Wayne Airport, also damaged the vacant Salvation Army building at the corner of French and 4th streets, but firefighters were able to save the building from complete destruction.

The original plans for the apartment complex called for demolishing the Salvation Army building. But a lawsuit filed in 1985 by residents opposed to redevelopment, and later joined by the historical preservation group Heritage Orange County, resulted in an out-of-court settlement that saved the old building.

The residents, who called themselves the Alliance for Fair Redevelopment, claimed at the time that the city was failing to provide enough low-income housing and that redevelopment projects such as the 4th Street complex would make the situation worse.

In March, 1986, the city and plaintiffs reached agreement on redevelopment plans that would preserve more historic buildings--including the Salvation Army building--and provide additional low-income housing.

The project finally got under way last year. But it was halted on Jan. 4, when a city building inspector discovered that the contractor had failed to install proper anchor bolts--steel rods that anchor the wood framing to the concrete foundation. Some of the bolts were too short, penetrating only three-quarters of an inch into the concrete, rather than the required eight inches, senior building inspector Jack Thomas said. Some bolts had not been installed at all.

Construction was allowed to resume on Jan. 24 after engineers had determined that the problem had been corrected and that the building would be safe.

Last month, however, framing work on the project was ordered stopped, Thomas said. This time there were no major violations, but the contractor had failed to correct a number of building code violations previously brought to his attention, such as cracks in concrete slab and faulty staircase construction, Thomas said.

The city allowed work to continue on June 1, seven days before the fire reduced eight months of construction to a pile of rubble in less than three hours.

Urban Ventures executive Kevin Wieck said insurance adjusters soon will be inspecting the ruins of the construction site, which was to have been completed this fall.

“Our intent is to reconstruct the project,” he said.