CITY READIES DEFENSE TO ALLEGATIONS OVER EX-BERMITE SITE HOUSING DEVELOPMENT PACT VIOLATED BY SANTA CLARITA, CONTENDS OWNER RFI.

Byline: Heather MacDonald Staff Writer

SANTA CLARITA - City leaders scrambled on Monday to return the legal volleys launched last week by the owners of the former Bermite explosives factory.

The City Council will hold a special closed-door session at 4 p.m. Thursday in City Hall's council chambers. Officials are expected to discuss possible strategies to deal with Remediation Financial Inc.'s assertions that city officials have violated the development agreement allowing 2,911 homes to be built on 996 acres in the center of the city.

Jeff Lambert, the city's director of planning and building services, said city staff members brainstormed about several possible courses of action in response to RFI's assertions. He declined to reveal details, adding that they would be presented to the council members.

RFI has filed a lawsuit against the city and the individual council members but has held off on serving it, said Gary Brown, the director of development. The company is eager to talk with city officials about possible solutions, Brown said.

The property, in the heart of Santa Clarita, is littered with 275 chemicals and unexploded ordnance left over from decades of Defense Department contract work. Perchlorate, a byproduct of rocket fuel linked to thyroid disease, prompted the closure of four municipal wells in 1997. Rocket fuel was used at the explosives factory, records show.

The development agreement for Porta Bella prohibits construction on the property until it is certified as clean by the state Department of Toxic Substances Control.

RFI representatives assert that the city violated the agreement by building part of Golden Valley Road across the eastern edge of the site. The company has blocked the city's access to Golden Valley Road, stalling construction of the $200 million cross-valley connector.

Company officials say they agreed to the road construction in return for the City Council's consideration of their proposal to develop each portion of the property as it is cleaned and certified. That pact was included in a memorandum of understanding signed in 1999, which company officials believe the city failed to fulfill.

RFI is out of money, Brown said. Without phased development, the cleanup and development of the property is impossible.

The DTSC says ``phased development'' would be safe and effective.

RFI last week terminated the city's $1-a-year lease of the Santa Clarita Metrolink station off Soledad Canyon Road. The station could be shuttered at the end of the month, forcing commuters to the San Fernando Valley and downtown Los Angeles to use the less-popular Newhall or Via Princessa stops.

To keep the station open, city officials would have to purchase the property from the Phoenix-based company for about $3 million, or ink another lease, and agree to pay RFI what the property is worth - about $60,000 a month, officials said.