Resort developer sued over low-income housing

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PHOENIX (AP) -- A developer who wants to build a 600 million dollar luxury hotel in Scottsdale is in a battle with the federal government.

The government is upset over the destruction of an apartment complex that was home for low-income people.

The Phoenix Revitalization Corporation this month sued Scottsdale Canal Development in federal court.

The nonprofit Phoenix Revitalization Corporation is a remnant of the Resolution Trust Corporation, which sold distressed properties at bargain prices.

In some cases, it attached low-income-housing restrictions to properties.

The government claims the developer violated restrictions requiring the 12-unit complex to remain low-income housing.

It's the latest hurdle for Scottsdale Canal Development in a three-year push to rezone and clear the site for development.

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