Thursday, June 05, 2008
News
Local builder, county contest loan for burned building
Argus-Press File Photo The Wesener Building on Washington Street in downtown Owosso is shown boarded up following the July 4, 2007, arson.
By DOMINIC ADAMS Argus-Press Staff Writer
OWOSSO - An argument surrounding $15,000 in grant funds between the owner of the burned-out Wesener Building and Shiawassee County may end up in mediation.
Rock Solid Associates owner David Miller sued the county almost three months after a July 4 arson destroyed the historic site on Washington Street.
Miller contends he should not have to pay the remaining $15,000 of a housing rehabilitation loan to the county because fire destroyed the building.
The lawsuit came after Shiawassee County Commissioners denied Miller's request in September to reduce the payoff balance of the loan through the Shiawassee County Office of Development, Housing and Rehabilitation Program by 20 percent.
Mark Hanna - Miller's attorney - and Shiawassee County Prosecutor Randy Colbry presented information Tuesday during a court-ordered complaint review panel.
“That's why (county commissioners) had to back up because they didn't have the authority to do what they did,” Hanna said.
County Administrator Margaret McAvoy formed the committee and sits on it along with Robert Hardy and Jerry Scepka. The group has 15 days to notify both parties of its decision.
Court records show Owosso-based Rock Solid received $79,692 from its insurance company after the fire and repaid $64,693 to the Shiawassee County Office of Development, Housing and Rehabilitation Program because Miller did not rebuild.
Miller signed a mortgage with the county in 2004, utilizing funds from the Michigan State Housing Development Authority for renovations at the site.
In December, Shiawassee County Circuit Court Judge Gerald Lostracco ordered the contested $14,999 - which represents a year of Miller's renting five Washington Street properties - into a Shiawassee Circuit Court account. Court documents indicate the money will go to whichever party prevails in the dispute.
Hanna said he had to sue the county in order to receive due process via Tuesday's review.
“Rock Solid did not elect to not perform. It was a criminal act that stopped it,” Hanna said. “His building burned. Don't burn him. The guy is due his money. The guy did his work.”
Hanna asked the committee allow Michigan State Housing Development Authority officials to make a final decision.
Colbry said the $15,000 should go to the SCDHRP to fund other programs.
He also said Hanna's lawsuit had no merit.
Lostracco dismissed the civil case without prejudice, which means Hanna can refile the suit at any time.
“Rock Solid Associates took at least $65,000 in public monies toward this project. They decided, ‘we're walking away from this project but we want you to give us this another $15,000,'” Colbry said. “Mr. Hanna is asking that you make a gift - that you change this contract after its inception; in fact after its conclusion - that you change this contract and grant $15,000 to Rock Solid Associates. That would be contrary to the Constitution of the state of Michigan. This isn't something that is legal.”
The state's complaint procedure allows Miller to seek mediation if he is not satisfied with the review committee's recommendation. If Miller does not like what happens during dispute resolution, the county must notify MSHDA in writing about the case, according to MSHDA documents outlining the complaint procedure.
The Michigan State Police continue to investigate the Wesener Building arson, which killed 22-year-old Greg Shire.
- Dominic Adams may be reached at 725-5136 extension 239 or by e-mail at dadamsarguspress@gmail.com.
Rock Solid Associates owner David Miller sued the county almost three months after a July 4 arson destroyed the historic site on Washington Street.
Miller contends he should not have to pay the remaining $15,000 of a housing rehabilitation loan to the county because fire destroyed the building.
The lawsuit came after Shiawassee County Commissioners denied Miller's request in September to reduce the payoff balance of the loan through the Shiawassee County Office of Development, Housing and Rehabilitation Program by 20 percent.
Mark Hanna - Miller's attorney - and Shiawassee County Prosecutor Randy Colbry presented information Tuesday during a court-ordered complaint review panel.
“That's why (county commissioners) had to back up because they didn't have the authority to do what they did,” Hanna said.
County Administrator Margaret McAvoy formed the committee and sits on it along with Robert Hardy and Jerry Scepka. The group has 15 days to notify both parties of its decision.
Court records show Owosso-based Rock Solid received $79,692 from its insurance company after the fire and repaid $64,693 to the Shiawassee County Office of Development, Housing and Rehabilitation Program because Miller did not rebuild.
Miller signed a mortgage with the county in 2004, utilizing funds from the Michigan State Housing Development Authority for renovations at the site.
In December, Shiawassee County Circuit Court Judge Gerald Lostracco ordered the contested $14,999 - which represents a year of Miller's renting five Washington Street properties - into a Shiawassee Circuit Court account. Court documents indicate the money will go to whichever party prevails in the dispute.
Hanna said he had to sue the county in order to receive due process via Tuesday's review.
“Rock Solid did not elect to not perform. It was a criminal act that stopped it,” Hanna said. “His building burned. Don't burn him. The guy is due his money. The guy did his work.”
Hanna asked the committee allow Michigan State Housing Development Authority officials to make a final decision.
Colbry said the $15,000 should go to the SCDHRP to fund other programs.
He also said Hanna's lawsuit had no merit.
Lostracco dismissed the civil case without prejudice, which means Hanna can refile the suit at any time.
“Rock Solid Associates took at least $65,000 in public monies toward this project. They decided, ‘we're walking away from this project but we want you to give us this another $15,000,'” Colbry said. “Mr. Hanna is asking that you make a gift - that you change this contract after its inception; in fact after its conclusion - that you change this contract and grant $15,000 to Rock Solid Associates. That would be contrary to the Constitution of the state of Michigan. This isn't something that is legal.”
The state's complaint procedure allows Miller to seek mediation if he is not satisfied with the review committee's recommendation. If Miller does not like what happens during dispute resolution, the county must notify MSHDA in writing about the case, according to MSHDA documents outlining the complaint procedure.
The Michigan State Police continue to investigate the Wesener Building arson, which killed 22-year-old Greg Shire.
- Dominic Adams may be reached at 725-5136 extension 239 or by e-mail at dadamsarguspress@gmail.com.