U.S. Agency Sells Housing Tract to City : Lancaster: Burned in the filming of ‘Lethal Weapon 3,’ the site is bought for $3.2 million. It will be cleaned up and resold.

Lancaster’s Redevelopment Agency voted Monday to spend $3.2 million to buy an abandoned housing tract, a portion of which was burned in filming the movie “Lethal Weapon 3,” from the federal agency that manages the assets of failed savings and loans.

The purchase of The Legends tract by the city follows a similar $1.4-million deal last month with the federal Resolution Trust Corp. to buy the unfinished portion of its sister tract, Silverado. The city bought the blighted sites in hope of cleaning them up.

City officials said the outcome is a satisfying turnabout from last December, when the federal agency announced the city had been outbid for both sites by private developers. However, those deals were not consummated, and the agency returned to negotiations with the city.

The city plans to demolish eight partially built houses on The Legends site and is still considering what to do with four finished model homes that have been heavily vandalized. Eventually, the city wants to resell the 54-acre site at the southeast corner of 30th Street West and Avenue J for home development or a school.

The city has other plans for the Silverado property, which was the last phase of an otherwise completed tract at 30th Street West and Avenue L. The city intends to hire contractors to finish 20 nearly completed homes and two foundations on a 3.6-acre site and then resell them as housing for moderate-income residents.

Both tracts belonged to the now-defunct U.S. Housing Corp. of Burbank, which stopped work on them in late 1988. In 1989, federal officials seized and later liquidated the projects’ lender, Hill Financial Savings Assn. of Pennsylvania. The houses have been boarded up since mid-1990.

The builder had just begun construction on The Legends when work was originally halted. The makers of “Lethal Weapon 3” demolished about a dozen of the unfinished houses after using them in January to film a simulated inferno.

Lancaster City Council members, sitting as the city’s redevelopment agency, voted 5-0 to approve the purchase. The $3.2-million price is higher than the city’s original bid. But the final price was a counteroffer from the private firm managing the property for the Resolution Trust Corp.

Steve Dukett, the city’s redevelopment director, said the city has an additional $690,000 budgeted for the site. A small part of that will be spent on demolition, and some of the rest may be spent to install landscaping around the site, which is overgrown with weeds.