Merchants Sue Santa Clarita Over Newhall Development Plan

NEWHALL — In a move that could doom a $7-million building project that the city of Santa Clarita hoped would spark renewed confidence in its plans to redevelop Newhall, two local merchants are suing the city for allegedly not properly studying the impacts of the project.

The owners of Auto Service Plus and Mountain Motors allege in a suit filed last week in Los Angeles that the city failed to complete an environmental impact report for the proposed construction of a Metrolink station and improvements to Railroad Avenue, which parallels San Fernando Road just east of downtown Newhall.

The merchants contend that without an environmental impact report there is no way to know how the project would affect traffic, safety and business in the area.

The lawsuit could prove “extremely harmful” to the project--the cornerstone of the city’s efforts to revitalize Newhall’s rundown commercial district--because it threatens to delay construction, thereby keeping the city from meeting important deadlines to qualify for federal, state and local grants, City Manager George Caravalho said.

There is no alternative funding available and without the time-sensitive grants the project probably would have to be scrapped, he said.

“There is $7 million at stake,” Caravalho said. “We have to begin construction by July or we’re probably not going to make our deadlines.”

City officials contend they have completed all the necessary environmental reports that the project requires.

But the city has only partially examined the effects of the construction on Railroad Avenue, a mostly dirt road now closed to traffic. Without a proper study, the truth about how the building of a train station in Newhall would impact the community is unknown, the suit contends.

“They were rushing the process as fast as they could,” said Fred Gaines, the auto dealers’ attorney. “The city was trying to meet funding deadlines. But in their haste, they did not follow the law.”

Jay Thompson, owner of Auto Service Plus, complained in an interview Thursday that the city’s plans to widen Railroad Avenue--an effort to divert some of the traffic congestion from San Fernando Road--will cause accidents and parking problems and hurt business in the community.

With the project hanging in the balance, city officials hinted they may counter-sue Thompson and Mike Laser, owner of Mountain Motors.

“We are considering all our options,” City Atty. Carl K. Newton said. “That is one of them.”

Caravalho claimed the merchants’ lawsuit stems from their desire to continue using Railroad Avenue as a free space to store their customers’ cars. “The whole issue is they don’t want us to use our own property,” Caravalho said. “We’re not taking their property, it belongs to the public.”