OCEANSIDE -- Asbestos has been discovered at Country Club Apartments, a 90-unit complex being renovated with the help of a $10.2 million loan from the city of Oceanside.

Steps are now under way to remove the cancer-causing material, which was found recently during construction work at the complex.

The apartments are near the Oceanside Boys & Girls Club in a working-class neighborhood east of Interstate 5 and south of Mission Avenue.

Officials said Monday that the cleanup effort is being monitored and poses no threat to the more than 100 residents still living there.

However, some residents aren't so sure.

Chris Clough said he and his four children moved out of their unit earlier this month after contractors knocked chunks of "popcorn" ceiling coating containing asbestos into his apartment as they worked on the building's roof.

"The stuff was falling right onto my carpet," Clough said. "We actually had a pickax come through the roof. The demolition was going on for about two and a half weeks before they stopped."

Rebecca Louie, director of operations for Wakeland Housing and Development Corp., the company conducting the renovations, said crews were moving through the complex one unit at a time, removing small amounts of the material from each unit.

Residents are being put up in motels overnight while the work is done.

"We have hired an asbestos-abatement contractor who specializes in this kind of work," Louie said. "We have also hired a licensed monitor to make sure the work is performed correctly."

A spokesperson for the San Diego County Air Pollution Control District said Monday that inspectors have found, in four separate visits, that work being performed at the complex was in accordance with asbestos-removal regulations.

Although its use is not banned, asbestos was once commonly used in the bumpy coatings applied to the ceilings in many homes.

According to the U.S. Environmental Protection Agency, continued inhaling of asbestos fibers can increase the likelihood of developing lung cancer and other respiratory problems.

Clough said workers eventually stapled plastic sheeting to the ceiling in his apartment to catch the falling debris.

He said he had an independent asbestos-testing company confirm that the material contained asbestos.

"I told (Wakeland) I'm not moving back in," Clough said. "(Wakeland) agreed to help us find a new place to live."

She said the decision to pay for the Clough family to relocate under the Fair Housing Act should not be taken as proof that Wakeland did find a problem in the apartment.

"We're not relocating him because of his asbestos concerns. We're just relocating him because he would not go back. We do not believe there is anything to (his claim)," Louie said.

In May, the Oceanside City Council voted unanimously to loan $10.2 million of its affordable housing funds -- mostly collected from developers of market-rate housing in the city -- to buy the complex.

Residents have remained in the units since construction efforts started in July.

Crews are working to replace ceiling light fixtures, and scrape a coating that contains asbestos from around fireplaces in each unit.

Anita Tinsley, a spokeswoman for the air quality control board, which is charged with making sure all asbestos-abatement work is done properly, said an inspector has made four unannounced visits to the project since July 1.

"As far as we can see, they have followed every air pollution control law," Tinsley said.

She said that crews hang sheets of plastic on all inside surfaces of each apartment and pump air through a special filter designed to trap every particle of dislodged asbestos.

She said the inspector looked into Cough's complaints but was "unable to substantiate them."

Contact staff writer Paul Sisson at (760) 901-4087 or psisson@nctimes.com.