City officials on Friday said they stand by Downey’s partnership with low-income housing developer National Community Renaissance despite a raid Thursday at the developer’s Rancho Cucamonga headquarters by federal agents.
The offices of National Community Renaissance were among nine sites targeted by the FBI and IRS, according to the Inland Valley Daily Bulletin.
Sources told the Bulletin the 100-agent search was tied to a $102 million settlement in 2006 between San Bernardino County and Colonies Partners LP and the group’s co-managing partner, Jeff Burum.
Burum was a founder of National Community Renaissance, but he resigned from an unpaid position as chairman last year after allegations of bribery regarding the settlement with Colonies Partners.
Downey has partnered with National Community Renaissance to develop 50 low-income apartments at the site of the now-demolished Verizon building near downtown Downey, a project dubbed “The View.”
National Community Renaissance did not immediately return a message left at its office Friday.
Downey Community Development director Brian Saeki said National Community Renaissance, known as National CORE, went through a public qualification process and won the deal with the city on the merits of the agency’s proposal.
“From staff’s perspective, we’re not looking at changing anything,” he said. “They went through a full-blown, public (request for proposals).”
Councilman Mario Guerra said the nature of the probe led him to believe the raid was related to Burum’s past and had little or nothing to do with National CORE’s practices.
“To us, it’s kind of a non-issue,” he said. “There’s obviously something going on there from the past, but, from what we can tell it’s got nothing to do with the current issues. In doing our due diligence in looking who to work with for this project, it seemed like that company has managed its properties with the utmost integrity.
The National CORE deal in Downey could soon enter escrow, Saeki said.
The city has already pledged redevelopment money to the project, and it won a competition for housing money that the City of Industry did not want to use, Saeki said.
Downey also applied for competitive tax credit, Saeki said.
If Downey wins the credit, the property would likely enter a 150-day escrow before construction could begin, he said.