Judge questions tall buildings suit settlement | Local News | record-eagle.com

2022-07-04 04:12:53 By : Mr. Long Hu

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A boater approaches downtown Traverse City on the West Arm of the Grand Traverse Bay on Tuesday.

A boater approaches downtown Traverse City on the West Arm of the Grand Traverse Bay on Tuesday.

TRAVERSE CITY — As some in Traverse City gather signatures to place a repeal of its tall buildings vote requirement on the November ballot, a federal judge raised questions about a proposed settlement of a lawsuit challenging that requirement.

Both Traverse City and 326 Land Company have until July 29 to answer U.S. District Court Judge Paul Maloney’s request for briefs and supporting documents to show their just-reached agreement was legally sound.

The Michigan Western District judge also wrote the court had concerns about possible collusion between the developer and city — accusations both deny.

Maloney noted both oppose a separate ruling by 13th Circuit Court Judge Thomas Power arguing all rooftop features count toward a building’s height when considering whether it should go to a public vote.

He also wondered if the developer filed suit in federal court after Power ruled against its previous challenges.

“The parties conclude plaintiff has vested property rights,” Maloney wrote. “The parties must now establish a sufficient legal and factual basis for their conclusion.”

Tom McIntyre, the company’s managing member, said the suit being filed in federal court because it’s where he and his legal counsel believed it ought to be filed, but not an attempt at finding a friendlier audience. He denied there was any collusion between the company and city.

So did Peter Worden, an outside attorney representing Traverse City in the case. Both sides disagreed strongly on questions of whether the company had a vested right, he said. That is, until the company turned over documents and several people involved in the project answered questions under oath.

Among them was the project’s contractor, McIntyre said.

Those depositions and documents showed the contractor had dug numerous holes that would hold the concrete-and-steel piers for the building’s foundation, Worden said.

Whether the court would agree those holes met the threshold past rulings set for determining who should have a vested right wasn’t clear, Worden said. But he believed the developer had enough of an argument to make the city’s case uncertain.

That could not only put the city at risk of losing money to pay for damages to the developer, but the judge’s ruling could result in a new precedent that city planners would struggle to follow.

“Could we have won? Absolutely. Could we have lost? Absolutely, and that’s a risk-benefit analysis you have to do in every case,” Worden said.

Jay Zelenock, an attorney for Save Our Downtown, said he saw no solid argument that the developer had a vested right, nor that the city was in danger of losing money to a damages claim.

Some of the group’s board members and supporters backed the charter amendment that created the vote requirement when city voters adopted it in 2016, said Brenda Quick, who serves on the board.

Zelenock said the foundation holes didn’t look anything like what he argued substantial progress on construction should include. And the developer had to build it regardless of whether its right to a 60-plus-foot-tall building was being affected.

Maloney pointed to past rulings that demolishing old structures and restoring the earth, planning work and landscaping aren’t enough.

Worden said the issue becomes where to draw the line. He was uncertain where the judge would draw it.

Now, the city and developer must submit documents, depositions and a summary of laws applying to the case’s vested rights issues, according to Maloney’s order. They must also explain how the developer’s vested rights supersedes the city’s tall buildings vote requirement.

Power similarly questioned a lack of adversarial tension between the city and developer in 2017 after the city took a neutral stance on 326 Land Company’s challenge to the vote requirement’s validity, as previously reported.

Those defending the vote requirement at one point noted then-city Planner Russ Soyring reviewed part of a draft of the developer’s lawsuit, which Soyring previously defended as something he would do for anyone who asked him about the city’s zoning history.

Zelenock agreed the city then successfully defended the charter amendment when the same developer sued again, but with help from Save Our Downtown and its attorneys, Zelenock included.

Maloney denied a request by Save Our Downtown and Brenda Quick’s husband, Albert Quick, to intervene in the latest challenge in federal court for lack of a legal right to take part.

While Worden previously defended the city’s efforts to uphold the charter amendment — he represented the city for 326 Land Company’s earlier challenge — Zelenock said he still doesn’t believe the city is fighting for it hard enough. Zelenock pointed to the settlement agreement and statements made by city officials against the vote requirement.

Maloney’s questions about collusion demands answers, which Worden said he’s confident will satisfy the judge that there is none.

Meanwhile, several people including a current city commissioner and past planning commission chairwoman are gathering signatures to put a repeal of the vote requirement on the Nov. 8 ballot.

Commissioner Tim Werner and Linda Koebert, who served on the planning commission for a time until late 2020, separately said they circulated petitions to gather the needed signatures — 5 percent of the city’s registered voters, according to state law, or about 700, Koebert said.

So has Raymond Minervini, and he, Koebert and Werner each said they’re aware of numerous others circulating petitions as well.

Minervini is president of The Minervini Group, the company behind efforts to convert the defunct Traverse City State Hospital to Grand Traverse Commons, and said he believes the requirement is too much of a burden and uncertainty factor to developers.

That’s impacting the city’s housing market — he pointed to TC Innovo Hall’s and McIntyre’s respective projects being on hold, as well as HomeStretch Nonprofit Housing dealing with the 60-foot cutoff in its own plans for city parking Lot O.

“I think we know if we have a nonprofit like HomeStretch, the more small units they can place on a given lot, the lower those costs per home will be, and that ... savings can be passed along to the affordable home renter, the apartment renter,” he said.

Quick said she thinks it’s sad that there’s an effort to take away voters’ right to have a say on new construction over 60 feet in the city. She also noted that there’s no guarantee that any new project contains housing, much less affordable units — Minervini separately acknowledged as much while noting the city’s master plan and zoning contemplates lots of land uses downtown.

As national events have put U.S. democracy in the spotlight, Quick said she was troubled by what she saw as an effort to diminish city residents’ right to have a voice in deciding on building projects. That’s true even if they have other chances, like public comment or starting their own citizens group.

“You have the right to become involved either directly or indirectly to any degree you like, but the bottom line comes down to the fact that this is an effort to take away a liberty interest, and that is the right to vote,” she said.

Koebert, on the other hand, said she believes in representative government and would rather put the choice back in the hands of the city’s elected commissioners and appointed planning board members.

Signature gatherers have until June 30 to get enough, Koebert said.

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