The intersection of 31st Regiment Court and MacArthur Drive sits in the heart of a sprawling ghost town of homes slowly being suffocated by mold and tangly weeds. Abandoned nearly a decade ago, the stretch of once vibrant streets and cul-de-sacs is a reminder of the Monterey Peninsula's past -- and perhaps a key to its future.

Within months, the federal government will transfer 4,800 acres of the old Fort Ord to the cities of Marina, Seaside, Monterey, Del Rey Oaks and to Monterey County as part of the largest coastal redevelopment project in the state's history.

Most of the 2,500 homes will be leveled -- deemed too expensive to fix -- and a new community will emerge. Just what kind of community is the focus of a pitched battle rife with racial and class-based undercurrents.

Should the former Army base become a largely working-class area of ``affordable housing'' -- a residential safety net in a county that is among the nation's least affordable? Or should most of the new growth be upscale homes and stores and tourist attractions that spur economic growth -- a way for the county's poorer communities to reap the benefits that have largely gone to places like Carmel and Pebble Beach?

Rep. Sam Farr, a lifelong resident of Carmel, wants to require half of the planned 6,000 homes be affordable to people who scrub hotel bathrooms or fight fires on the Monterey Peninsula.

``Fort Ord represents the greatest opportunity for affordable housing in the state's history,'' he said.

But officials from Seaside and Marina, erstwhile military towns that will get the lion's share of the free federal land, say they can't afford to be the dumping ground for affordable housing. They want to diversify their communities with wealthier housing and shops and new industry.

On Friday, the board of the Fort Ord Reuse Authority (FORA) will consider Farr's recommendations.

`A public gift'

The congressman has threatened to hold up the transfer if he's not satisfied with the housing plan. He's joined by a coalition of activist, church, labor and environmental groups that call the redevelopment plans of Seaside and Marina shortsighted.

``This land is a public gift from the United States of America to local communities,'' said Gary Patton, executive director of LandWatch Monterey County. ``It would be offensive to me as an American if the people who move into those homes don't represent the full diversity of those who work and live here.''

A recent FORA hearing brought out dozens of people holding signs such as ``Firemen Need Affordable Housing'' and ``Children of Color Need Affordable Housing Not a Golf Course.''

Marina (44 percent white) and Seaside (49 percent white) have significant Latino, Asian and black populations, especially compared with wealthier neighbors such as Carmel, which is 95 percent white.

``Every community has a moral obligation for the low-income, working families that fuel the economic engines of the county -- the agricultural and tourist industries,'' said Juan Uranga, a lawyer who directs the Center for Community Advocacy in Salinas.

But local government officials worry that idea fails California Economics 101.

``Seaside already has a preponderance of affordable housing,'' said Dan Keen, Seaside's city manager. ``We now have an opportunity to address some of the imbalance in terms of tax revenues and services. With Fort Ord, we have land and water. We have a new frontier.

``You ask any city manager what produces revenue. It's tourism, hotels and commercial use.''

But affordable-housing advocates say they worry that each city looking out strictly for its own needs will destroy any chances to right a wrong.

``If we don't build affordable housing at Fort Ord, it's not going to get built,'' said Paul Byrne, a Carmel Valley architect.

As part of an affordable-housing design contest, Byrne took a 60-by-100-foot lot, common in east Salinas, and designed three homes surrounding a Monterey Colonial-style courtyard. He calculated the two two-bedroom homes would cost $100,000 each, the three-bedroom homes $150,000.

But Seaside Mayor Jerry Smith worries about the creation of Fort Ord ghettos.

``Seaside has been the stepchild of the Monterey Peninsula,'' said Smith, who was born and raised in the city. ``I doubt if Sam Farr has ever lived in a ghetto in a two-bedroom home with four other people. I have.''

Under Farr's proposal, 10 percent of the new homes would be ``workforce housing'' tailored for teachers, cops, firefighters and nurses who can't afford a house. An additional 40 percent would be aimed at the working poor and people of average means.

Seaside and Marina officials argue that they plan to make at least 20 percent of the new housing affordable. They note that FORA committees have come up with a slew of recommendations, including the creation of community land trusts aimed at making certain homes affordable forever.

``It's a travesty that Sam Farr wants to pre-empt all that hard work,'' said Marina Mayor Ila Mettee-McCutchon.

`Least affordable'

Monterey County gained nationwide notoriety last year when it was designated the ``least affordable'' area by the National Association of Home Builders. The median-priced home in June was $385,000, the median income for a family of four was $57,100.

``Young people can't afford to live here unless their parents die and leave them the house,'' Pacific Grove Councilman Ron Schenk said.

Activist LeVonne Stone, who backs Farr's plan, resents the implication that Marina and Seaside need to be ``upgraded.''

``What does that mean?'' said Stone, who lives in a portion of Ord housing that was renovated before it was allowed to rot. ``We don't have enough rich people living here?''

In 1994, when the Army infantry training base closed, the economic effect was devastating. The area lost more than 14,000 soldiers and nearly 4,000 civilian jobs. The rental vacancy rate in parts of Seaside and Marina soared to more than 20 percent.

That partially explains why the abandoned duplexes, four-plexes and townhouses were never revitalized.

The military kept nearly 1,600 units of housing for remaining Fort Ord soldiers and the nearby Naval Postgraduate School, Defense Language Institute and Presidio of Monterey. The Mid-Peninsula Housing Coalition restored 548 units for military families and other low- and medium-income residents. And California State University-Monterey Bay provided 1,388 units for students and families.

But the transfer of most of the land was held up as the Army spent more than $340 million to clean up toxics and unexploded ordnance. The ghost town deteriorated.

``You can take care of the lead paint and the asbestos, but once you have mold like that growing it's a huge problem,'' said Jane Barr, a project manager with the housing coalition.

Community activists such as LandWatch's Elizabeth Panetta who survey the shattered windows and overstuffed '70s couches tossed on front lawns say the failure to revive the ghost town illustrates yesterday's lack of political foresight and today's lack of leadership and courage.

As for Farr's ``50 percent'' solution, she said, ``I think political will is the bottom line.''