Close to 1,000 acres of contaminated land at the heart of the Santa Clarita Valley will likely move out of bankruptcy court in about two months’ time, once the claims of professionals seeking to be paid are reviewed, a judge in Phoenix said Thursday.

In terms of getting the land cleaned up, however, the court decision changes little, experts said.

The land once owned by weapons manufacturer Whittaker-Bermite is still contaminated.

The multimillion-dollar, multi-year cleanup of contaminants, supervised by the state, is ongoing.

And current property owners RFI Realty Inc., who appeared as debtors in bankruptcy court Thursday, remain broke and unable to sell the land.

On Thursday, an attorney representing RFI appeared before a judge at the United States Bankruptcy Court for the District of Arizona and asked him to dismiss its case.

“We tried to stay in bankruptcy, but we found there is no ‘bank’ in ‘bankruptcy,’” said attorney Alisa C. Lacey.

Penniless

Lacey explained RFI has exhausted all its resources, has no money and cannot even pay to store the rooms full of paperwork generated by decades-long legal wrangling over the toxic land and its cleanup.

It cannot even afford to pay the one man hired to lock and unlock a gate to the property, she said.

“We are at the end of what bankruptcy can solve for this case,” she said.

The company’s motion filed in court states in part: “Debtors have now reached the absolute limit of their resources.”

Before issuing his decision, Judge Charles G. Case II said: “Keeping it in Chapter 11 (bankruptcy) is not possible.

“If and when I dismiss this case, we’re going to go back to it being contaminated land owned by a penniless debtor as if the matter was never in bankruptcy court.”

While Lacey explained her motion to have the case dismissed, attorneys for several other interests in the case listened in by telephone to the court proceedings.

Parties on the phone representing firms with interests in the property included:

* Whittaker Corporation, responsible for the cleanup.

* Its insurance company, Steadfast Insurance, subsidizing that cleanup.

* The state Department of Toxic Substances Control, overseeing the cleanup.

“We would have preferred a sale,” Lacey said, explaining RFI’s tough position, familiar to many as an “underwater” financial situation. “We had a buyer, but that buyer backed out, at which point the world changed.”

In September 2008, SunCal Santa Clarita announced it was not going to purchase the Whittaker-Bermite site as planned, but later took a pass on the deal.

“I am inclined to dismiss this case once we have tied up the loose ends,” Case said in issuing his judgment Thursday.

He granted RFI a 60-day extension on the voting trust, which authorizes the company to make payments.

“Once the fee application issue is resolved, I am more than likely to dismiss this case,” Case said.

Lengthy cleanup

In 1999, Whittaker sold the property to RFI, which later declared bankruptcy in July 2004.

Whittaker, cited for having withheld crucial information in its reports by the Department of Toxic Substances Control, was then ordered to clean up the site.

Paul Brotzman, Santa Clarita’s director of community planning, said: “The city is interested in seeing the property cleaned up and developed.”

Although the cleanup of contaminated soil may take 25 to 30 years, the city hopes to see the land ultimately developed.

“What the city is trying to do now is resolve the liability issue,” he said.

The ultimate property owners — once the soil is cleaned and the property approved for development — would still run the risk of civil liability due to persistent concerns over groundwater contaminated with perchlorate, he said.