Disney Sues Anaheim to Block Plan for Low-Cost Housing

The Walt Disney Co. (DIS) is suing the city of Anaheim over a controversial residential project that would add low-cost housing in the city's resort district.

Disney has long opposed the proposal to build 1,500 condominiums and apartments, including 225 units for lower income residents, near its amusement parks. The entertainment company says residents would be out of place in a district designed for tourists.

"This lawsuit speaks to how important we view this Anaheim resort area and that we make sure the vision sticks," said Disneyland spokesman Rob Doughty.

The Anaheim City Council is considering whether to reopen debate on the residential project after rejecting the proposal earlier this month with a split council vote.

The project's developer appealed and argued that Councilwoman Lucille Kring, who was told to abstain over of a possible conflict of interest because she planned to open a wine bar nearby, should have been allowed to vote.

The lawsuit filed Monday asks that Anaheim nullify the environmental analysis it approved for the project, claiming the process was legally flawed.

The resort area has increasingly has given way to hotels, restaurants and the tourist-friendly retail district called Downtown Disney.

Walt Disney himself complained that soon after he opened Disneyland in 1955 the area outside the park became filled with fast-food restaurants, cheap hotels, ugly neon signs and ticky-tack tourist attractions.

Disney officials want the 26-acre parcel at issue to be developed as an upscale hotel-condominium project.

Housing advocates argue that the apartment-condo proposal would be convenient for entertainment workers making modest wages.

Anaheim Mayor Curt Pringle said he wasn't surprised Disney went to court.

"There's no question this is a very significant issue to them and they are using all the means by which they can express that concern," he said.