Special Section: San Bernardino Co. Probe

Rancho Cucamonga developer Jeff Burum is a man of contrasts.

He is a champion of affordable housing and a builder of luxury homes.

He and his companies give generously to charities and donate heavily to elect political candidates he favors and unseat those he doesn't.

Story continues below

2008 / The Press-Enterprise

Jeff Burum, chairman of the board of National Community Renaissance, meets with community members to describe a community center under construction at Citrus Grove of Rialto in March, 2008. Burum, known as a hard-nosed businessman, is a champion for affordable housing.

In the business arena, he is a tough negotiator and driven competitor. But he also is someone who provides lavish gifts to friends and others who help him and his causes.

People long associated with Burum describe him as a self-made businessman with a passion for affordable housing, a clever for-profit developer who successfully built on land that others shied from, and a fearless person who is dogged in pushing his agenda.

He has nimbly adjusted with the economic trends, founding Diversified Pacific, a for-profit home building company, in anticipation of the last real estate boom and then winding down faster than many of his competitors when the market began to tank.

In the middle of a recession, Burum tapped his friends and associates last year to raise $60 million to invest in foreclosed and bargain-priced real estate. So far the fund has taken financial control of land that could accommodate 1,600 residential lots in Riverside, San Bernardino and Orange counties.

Burum, a Republican, has given millions of dollars in campaign contributions to federal and state lawmakers, San Bernardino County supervisors, local city council members and political action committees.

More than two dozen charities throughout Southern California have benefited from his gifts, including a scholarship fund and an education program for government officials at his alma mater Claremont McKenna College.

"He has a vision. He has energy and he can make things happen," said Conrad Egan, executive director of the national Millennial Housing Commission, which Congress created in 2000 to report on affordable housing. Burum served on the commission as a national expert.

But Burum's largesse also has led to controversy.

He gave a former public official a trip aboard his private jet and a $12,000 Rolex watch, according to court documents. An informant told investigators that Burum arranged a visit from prostitutes during their night in New York City, the documents say.

The official, Jim Erwin, did not report the gifts on required disclosure forms and was arrested on 10 felony charges, according to the documents.

He has said in an interview that he did not have sex with a prostitute.

The trip and gifts were a way of thanking Erwin for his role in helping Burum settle a legal dispute with San Bernardino County, court records show. The 2006 settlement gave Burum's company, Colonies Partners, $102 million.

Erwin recently resigned from his post as chief of staff to county Supervisor Neil Derry. Burum has not been charged with any wrongdoing.

Housing passion

Burum, 46, was born in Maryland and moved to California in the 1980s to attend Claremont McKenna College. His friend San Bernardino County Supervisor Paul Biane said Burum's high school grades earned him a scholarship there.

Burum, who speaks Mandarin, graduated in 1985 with a degree in international relations and moved to Rancho Cucamonga to begin working in the development business.

"Rancho was the best affordable community I could find," Burum said in a recent interview.

Burum has called the city home ever since. He and his wife have two children. Property records show they own a second home in Running Springs, in the San Bernardino Mountains.

Burum said he made a good living working in the private development business in the late 1980s. But, with the housing market taking a downward turn, he said he decided it was time to take a hiatus and give back to the community.

He volunteered in 1990 as a census worker counting migrant workers living in camps in Rancho Cucamonga.

"They wanted mostly males, because we had to go to the camps at night," Burum recalled. He saw the conditions people lived in. He didn't like it.

Burum in 1991 founded the nonprofit Southern California Housing Development Corp. He began pushing his vision: Projects had to provide quality affordable housing and community centers where residents could obtain onsite job training, day care and other social services.

He regularly attended public meetings to voice his concerns over affordable housing. A frequent library visitor, he read all he could about the Department of Housing and Urban Development and its regulations, he said. He pointed out when government wasn't following its own affordable housing rules.

"I became the housing guy," said Burum as he sat in his Rancho Cucamonga office recently, dressed in a vintage striped bowling shirt.

Such persistence led the federal Resolution Trust Corp. to tap Burum's nonprofit group as an adviser in California.

The trust corporation, set up to dispose of homes repossessed in the savings-and-loan crisis, had affordable housing requirements.

Southern California Housing was its adviser from 1992-1997, helping to identify homes that could serve as affordable housing.

Story continues below

David Bauman / The Press-Enterprise

Chris Stewart, 18, stands on a residential street in the Citrus Grove of Rialto development that opened in October. Stewart used to live in the neighborhood and says it was plagued by violent crime and drugs. The area received a facelift from National Community Renaissance.

Burum also pushed hard for local cities to give Southern California Housing a chance to directly revamp housing.

Burum, then in his late 20s, said he made pitch after pitch to cities throughout the region for affordable housing projects.

"No one bit," Burum recalled. "They thought this young guy couldn't pull off the grand vision."

Rialto finally decided in 1992 to give Burum a chance, asking him to revamp a rough area of fourplexes.

Burum recalled how gang members fired bullets into the house next door to his project to send a message.

Four years later, flanked by then-Rep. George E. Brown Jr., D-San Bernardino, Burum received a national award for the turnaround of the apartments.

In another Rialto neighborhood one afternoon in early April, teens congregated at a community learning center that is part of Citrus Grove, once-dilapidated condominiums that Burum's affordable housing company gutted, restored and reopened in October as a 152-unit apartment complex. The project cost $37 million.

Christopher Stewart, an 18-year-old volunteer who teaches hip-hop dancing at the center, said before the community was renovated, he and his brother lived there with their grandmother. Gang members used to hang out in the streets, and gunshots could be heard frequently. "I used to be scared to take out the trash," he said.

Now a gate secures the neighborhood of tidy tan apartment buildings, a tot lot and community center. Trees have been thinned to discourage criminal activity, and bright new landscaping has been planted.

"This is way different," said Stewart, as he glanced up the street where he once lived. "It still amazes me when I come here."

Building on his success, Burum eventually took his nonprofit affordable housing enterprises national, creating National Community Renaissance.

The company owns or is developing more than 10,000 apartments, most in Southern California but also in Texas, Arkansas, Florida, Colorado and New Jersey. Burum last year hired Orlando J. Cabrera, former assistant secretary for public and Indian housing in the Department of Housing and Urban Development, to be the company's chief executive and run its day-to-day operations.

COLONIES PARTNERS

By the late 1990s, Burum was ready to move back into the for-profit development business, predicting a rebound ahead for the then-depressed Inland housing market.

He became a co-managing member of Colonies Partners, which took over a stalled development project in Upland in 1997. The following year, he co-founded a new homebuilding company, Diversified Pacific Development Group.

Matt Jordan, 56, said he was a partner in an Ontario accounting firm in the late 1990s when he met Burum through the Inland Empire chapter of the Young Presidents Organization. Burum recruited him into the new venture.

They decided to look for a market niche that was underserved in San Bernardino and Riverside counties and chose high-end, executive housing. Some sold for well over $1 million at the peak of the market.

Jordan, now co-owner and day-to-day manager of Diversified Pacific, said Burum is a strategic thinker.

"He has a good feel for trends and how a piece of land will lay out in the future. It is a gift I don't have," Jordan said.

Steve Johnson, with Metro Study, a real estate consulting firm that has done work for Diversified Pacific, said Burum "has a very good eye at interpreting what the consumer wants at the high end of the market."

He said he has seen Burum tweak architectural drawings by raising a ceiling or expanding counter space or repositioning windows to improve views.

Randall Lewis, of the Lewis Group of Companies, has known Burum for more than a decade. Burum and his wife have long been active in Rancho Cucamonga civic and charity causes, Lewis said.

Lewis said he tapped Burum to join him and others in an alliance to compete for the right to develop 1,200 acres of surplus county land near Rancho Cucamonga.

"He has been involved in some complex development projects, including the Colonies in Upland, and has been successful in solving many difficult problems such as grading, drainage and working with complicated pieces of land."

Political Money

Bill Alexander, former Rancho Cucamonga mayor, contends that substantial contributions to local politicians from Burum and his companies have helped him achieve success.

Alexander said Burum was part of a group that caused him to lose his re-election bid in 2006 by contributing heavily to the campaign of his opponent. Alexander said he had irritated Burum by trying to control development in the city.

Story continues below

JEFF BURUM

As a City Council member, he opposed a move to allow land in Rancho Cucamonga to be annexed by Upland, a step needed to expand commercial development on Colonies' property.

"Jeff Burum knows where there is money to be made, and he is wise enough to know that without having political consensus on moving forward with development, his ability to continue to be profitable is diminished," Alexander said.

Burum has built a powerful network that supports his causes, Alexander said. "He has associates and organizations and political connections capable of providing power behind political campaigns. It is a conglomerate of money and influence."

Upland Councilman Ken Willis, who has received campaign donations from Burum, said the developer's sharp presentations contribute to his success.

Burum made a compelling case for the Colonies project before the Upland City Council and agreed to make changes to prevent flooding and groundwater pollution.

"He is very intelligent. He is very methodical. He certainly has a presence when he stands before a group," Willis said.

Burum in past interviews said he began donating to campaigns to have his opinion heard and be treated equally, since other developers also give significantly to local officials.

Burum and his companies since 2003 have contributed more than $1.2 million to political action committees.

And in 2002, Colonies Partners contributed $12,000 to Biane in his successful campaign to unseat Supervisor Jon Mikels in the 2nd district, which includes Rancho Cucamonga and Upland. Burum clashed with Mikels over the development.

Legal battle

Burum's persistence emerged again during the nearly five-year legal battle Colonies Partners fought with San Bernardino County.

Colonies Partners contended the county opened storm drains that sent water flowing onto the company's 434-acre commercial and residential development in Upland, forcing it to build a $25 million, 67-acre drainage basin to hold the runoff.

The county countered that its decades-old flood-control easements allowed it to use the land to hold water and that it should not pay for improvements to make private development possible.

The court battle began in 2002, and through two trials, Colonies kept increasing the amount it thought the county owed.

The two sides finally reached the $102 million settlement in November 2006.

Throughout the legal wrangling, Burum kept the pressure on county officials -- some of whom were his friends -- in the hopes of receiving a favorable settlement.

Biane and former Supervisor Bill Postmus both have said they were buttonholed by Burum to talk about a potential deal when they saw him at events throughout the county.

The lawsuit over the development strained Burum's relationship with county officials, including Biane.

It also split the county Board of Supervisors and became a source of controversy for the county.

The county went through several law firms during the legal dispute. When the board approved the settlement in a 3-2 vote, no lawyers representing the county signed off on the deal.

In the two years since the deal, Burum has worked to repair his relationships with county officials.

Burum had halted political donations to supervisors in 2006 during the height of the lawsuit and even backed the opposition to a ballot measure increasing supervisor pay.

But in 2007, months after the settlement, Burum resumed giving campaign donations to supervisors, including $2,500 to former Supervisor Dennis Hansberger, who voted against the settlement.

Burum flew Biane to three Republican events in 2007 and 2008 aboard his jet and worked with county officials to launch a public-private partnership aimed at helping communities deal with home foreclosures.

Burum in the past has said the lawsuit with the county was over policy, not individuals.

"The reasons for my giving of the watches and bonuses to many people after the time of the Colonies lawsuit varied based upon the person's role and what they did," Burum said by e-mail.

For the county, the settlement's legacy lives on.

The county currently has a lawsuit pending in San Diego County Superior Court against three other public agencies it feels should help pay some of the $102 million.

A judge ruled this month that the case can move forward.

Reach Duane W. Gang at 951-368-9547 or dgang@PE.com

Reach Leslie Berkman at 951-368-9423 or lberkman@PE.com