Marquardt/30″/Cw1st/mike2nd

By SHELLY GARCIA

Staff Reporter

A plan to develop a $32 million industrial park in the heart of the San Fernando Valley has gained broad support from political leaders, the city Planning Department, and even the hard-to-please Van Nuys Homeowners Association.

But industrial solvents left behind at a 24-acre Van Nuys site by a former aerospace firm threaten to hamstring development for anywhere from six months to six years.

Officials with Lancaster, Penn.-based Ferranti International Inc., the property owner that has worked for nearly 10 years to ready the site for development, believed they had dealt with the contamination to the satisfaction of state regulators.

“We’ve done $3.5 million of investigation (of toxic substances) on this property and we have been very conscientious and forthright about it,” said James P. Shinehouse, Ferranti’s president and chief executive. “It is a good property, and it does not have an environmental problem.”

But officials with the Department of Toxic Substances Control, the state agency that oversees toxic cleanup, say the work of identifying the extent of contamination and then cleaning it up has just begun.

“Our charge is to assure that the site has been cleaned up to a level that’s safe,” said Ron Baker, a spokesman for the DTSC. “We feel there’s more characterization and investigation that needs to occur.”

The property, which is located at Saticoy Street and Hayvenhurst Avenue, was for years the home of Marquardt Co., an aerospace firm that manufactured components for aircraft, missiles and bombs. Ferranti took possession of the property in 1983 when it bought out Marquardt.

State regulators say that Marquardt left behind a legacy of industrial solvents, one of which, trichloroethane, has been found to cause cancer in rats.

Ferranti owns 54 acres at the site, but the company has reached an agreement to sell 24 of them to Hewson Co., a Sylmar-based developer that is planning to build the $32 million industrial park. The project has been designed to feature five new buildings with a combined total of 489,740 square feet of space.

Hewson, which counts among its projects the 40-acre North Valley Business Center in Sylmar, is waiting for Ferranti to iron out its dispute with the state before closing the transaction.

Supporters say the project would provide much-needed industrial space in the Valley, where the vacancy rate has been hovering around 5 percent and there is little land left to develop.

With such strong demand, industrial brokers have been anxiously awaiting a marketing plan for the property. L.A. city officials, including the Mayor’s Office of Economic Development and the office of Councilman Joel Wachs, have testified in favor of the project. It has even passed muster with the Van Nuys Homeowners Association.

The Los Angeles Planning Commission on Aug. 26 approved the project with a number of conditions, chief among them the need to resolve the environmental issues surrounding the project.

The planning commission has called for an independent, third party to evaluate whether the site is safe for development.

“The DTSC seems to feel further investigation is required. (Ferranti) feels they have investigated ad nauseum. There’s been a lawsuit with some language that’s hard to understand from our point of view, so we think the independent evaluation by a recognized expert can give us that information,” said Frank Eberhard, deputy director of planning in the city’s planning department.

News that the state wants, among other things, more extensive groundwater testing is especially vexing for Ferranti because the property owner believed it had reached a settlement with the state agency.

“They should read the settlement agreement,” said Shinehouse. “On March 23 of this year, we entered into a settlement. As part of the settlement, DTSC said they had no objection to the redevelopment of the project.”

Not so, says Yolanda Garza, a DTSC unit chief. “We had a proposed settlement agreement, but it hasn’t been finalized,” she said.

The agency’s change of heart stems from a discovery of contaminants in the groundwater, indicating that a wider area must now be tested. “We know enough to know there are contaminations spread out throughout the site,” said Garza. “We also know that the groundwater is contaminated. So we’d have to find out where the source area is.”

Shinehouse said his company has already conducted extensive groundwater tests, and believes contamination is within safe levels.

“We also tested groundwater,” Shinehouse said. “Some has contamination, some has none, but where it does, the levels are lower than the acceptable standards unless you want to build a house.”

Ferranti International Inc. is the U.S. holding company for Ferranti International PLC, an electronics manufacturing company that went into administrative receivership in 1993. The company is in the process of liquidating all of its assets here and abroad.

Ironically, the rest of Ferranti’s 54-acre Van Nuys site is not affected by state regulators, even though the company wants to sell that land, too.

Part of that property is currently leased to Ambassador Fine Foods, apparel maker St. John’s Knits and aerospace firm Kaiser Marquardt Inc. Because those properties are not currently targeted for redevelopment, they do not face regulatory hurdles.

But because the dilapidated buildings at the 24-acre development site must be torn down and replaced to accommodate Hewson’s proposed project, Ferranti is subject to regulation by the DTSC.

The state department has been at odds with Ferranti since the company decided to discontinue manufacturing on the site several years ago. In 1994, the agency reached an agreement for a cleanup plan and then withdrew it when additional contaminants were detected. The department turned down several of Ferranti’s subsequent plans for testing and cleanup, saying further study on the extent and types of contamination were needed.

In 1997, Ferranti filed suit against the department, and earlier this year, the company and agency went before an administrative law judge to iron out their differences. According to the transcript of the proceedings, those meetings culminated in March with a settlement agreed to by the two DTSC representatives in attendance, Jose Kou and Andres Canoa, along with Ferranti’s Shinehouse. Ferranti has begun the cleanup effort spelled out in the agreement, Shinehouse said.

Hewson also contends that the environmental issues have been resolved. “I don’t think they can (go back on the agreement),” said Scott Sheridan, senior vice president for Hewson. “A settlement agreement has been reached. That was done before a judge, and I think that finalized DTSC’s position as far as the developability of the property.”

The DTSC disagrees. Agency officials contend that additional studies can take another six months or six years.

“It’s so hard to say,” Garza said. “(Ferranti) believes, based on their independent data gathering, that they’re close to the end. But the department isn’t convinced of that. We’re at the very beginning.”