CITY COUNCIL WARNED OF POTENTIAL LAS LOMAS LITIGATION.

Byline: Eugene Tong Staff Writer

SANTA CLARITA - The developer behind the 5,800-home Las Lomas subdivision proposed in the Newhall Pass is readying for battle with Santa Clarita as the city seeks to extend its sphere of influence south into the project site - a move that could kill the plan.

City Attorney Carl Newton warned the Santa Clarita City Council on Tuesday night of potential litigation from developer Dan Palmer, prompting council members to delay discussion until June 14 on efforts to stop Las Lomas.

The council had planned to bypass environmental reviews and submit an application with the county Local Agency Formation Commission to expand Santa Clarita's sphere of influence to envelop part of the Las Lomas land. Declaring a sphere would give the city some say in development on its borders.

Michael Murphy, the city's intergovernmental relations officer, said Wednesday he still expects the council to move forward with the application to LAFCO and file a ``negative declaration'' in compliance with state environmental laws. The delay was needed to allow the city's legal staff to assess a letter from Palmer threatening a lawsuit if the city interferes.

``That would give the city attorney opportunity to more fully digest the letter, and the city attorney can provide us with advice based on a thorough review,'' Murphy said.

The sphere of influence effort, made in cooperation with the city of Los Angeles, would split the 555-acre project site southeast of the junction of the Golden State and Antelope Valley freeways between the two cities at the ridgeline.

With roughly 75 percent of the land in Santa Clarita's sphere, it would be difficult for Palmer to annex his project to the city of Los Angeles for its plentiful water. Weeks earlier, Los Angeles submitted its sphere of influence amendment to LAFCO, moving it north to the edge of Santa Clarita's proposed sphere.

But a May 9 letter from Las Lomas attorney Carlyle Hall gave the Santa Clarita leaders pause. It alleged Santa Clarita violated a court order requiring the city to prepare a full environmental impact report ``in any further processing of discretionary actions seeking to gain control and authority over the Las Lomas Project area.''

``It would make sense for them to make that decision after seeing the environmental impact report,'' Hall said after the council adjourned Tuesday.

The Superior Court decision came from a 2004 lawsuit challenging a city plan to annex parts of the Las Lomas site. Judge Dzintra Janavs ruled a negative declaration for the application inadequate.

Newton said Wednesday he intends to respond to the letter before the June 14 council meeting.

``They're arguments that they present on behalf of their client,'' he said. ``I do not think there's merit to any of them. ... They seek to advance their client's interest contrary to the proposed action of the city.

``We believe that for a sphere of influence amendment that you only need a negative declaration in order to do that.''

Newton said the city of Los Angeles received a similar letter, though he noted: ``It's interesting that the Palmer interest did not appear at the city of Los Angeles' proceeding and challenge it.''

Meantime, Palmer Investments spokeswoman Hilary Norton Orozco proposed meeting with city officials to discuss the project and its implications.

``We can talk about an appropriate future for Las Lomas,'' she said. ``I haven't heard what Santa Clarita wants from the site. I want to hear what they intend.''

``We're happy to meet with them,'' Murphy said. ``I anticipate to hear from them about setting a specific time for a meeting.''

Eugene Tong, [phone]

eugene.tong(at)dailynews.com