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untanglingwebs
El Supremo
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Flint taxpayers likely will pay for $8M Genesee Towers judgment in December, officials say
Published: Tuesday, September 28, 2010, 4:58 PM Updated: Tuesday, September 28, 2010, 6:33 PM
Kristin Longley | Flint Journal
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Flint Journal file photoGenesee Towers
FLINT, Michigan -- A special tax to pay for the $8-million Genesee Towers judgment against the city could be on Flint residents' tax bills this December, city officials said today.
The Michigan Supreme Court today declined to reconsider its decision not to hear the city of Flint's appeal of the Genesee Towers case, which upholds a previous decision that the city has to pay the building's owners more than $6 million plus interest, Flint Mayor Dayne Walling said.
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Share 18 Comments The ruling likely means the city of Flint will be court-ordered to put a special assessment on the December tax roll to pay for the legal judgment, City Attorney Peter Bade said. It also means the city of Flint would own the Genesee Towers building.
Finance Director Michael Townsend said the one-time special assessment would cost the average homeowner $150.
Walling said the legal department exhausted every avenue for appealing the decision against the city.
"No stone has been left unturned," Walling said. "It is very unfortunate these long-standing legal problems have hung over the city year after year."
Walling said the judgment is the result of a mistake by former Mayor Don Williamson's administration.
"Don Williamson decided to take this building and now all of us are going to have to pay," he said.
Williamson could not immediately be reached for comment this evening.
Bade said the city should know in the next week or so whether or not the courts will force the city to put a special assessment on the tax rolls.
The case dates to 2004, when the city condemned the 19-story building in downtown Flint.
The city and the building’s owners agreed to enter into arbitration over the property and its worth in 2006.
The arbitrator’s decision in 2007 awarded the building's owners -- V. Kumar and Sasikala Vemulapalli -- more than $6 million, including legal fees, but reduced by the cost of repairs, according to court documents.
Kumar Vemulapalli could not immediately be reached for comment.
City officials appealed the case, arguing the arbitrator exceeded his scope of authority in reaching the decision. The case was appealed multiple times, until the Court of Appeals ruled in December that there was no error in the arbitration award.
The Michigan Supreme Court refused to hear the city’s appeal of that ruling in June.
The talk of a special assessment for Genesee Towers comes as city officials discuss the possibility of a tax increase to help pay for public safety. Walling has said he would like to hear from residents on whether they would pay more taxes to help the cash-strapped city pay for police.
City wants study of Towers' integrity
THE FLINT JOURNAL FIRST EDITION
Thursday, February 12, 2004
By Christofer Machniak
JOURNAL STAFF WRITER
QUICK FACTS
About Genesee Towers
Completed in 1968, the 19-story structure includes 172,000 square feet of office space and a parking garage. When completed, it was the state's tallest building outside Detroit.
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Flint - Genesee County's tallest building could be one step closer to destruction.
Emergency financial manager Ed Kurtz authorized paying up to $40,000 to hire a Kalamazoo structural engineering company to examine the parking garage of Genesee Towers, 120 E. First St.
Some say the study could give the city enough evidence to condemn the 19-story building. City officials say the study helps them defend a lawsuit by V. Kumar and Sasikala Vemulapalli, the building's owners, who allege discrimination and a city conspiracy to take control of it.
Attorney Barry Wolf, defending the city against the lawsuit, said the city wants the study to determine whether the parking structure was properly repaired. The city first cited V. Kumar Vemulapalli in 2001 for several building code violations, including problems with the parking structure. Wolf also said Vemulapalli's lawsuit has no merit.
"The city has no idea whether the work was done properly," Wolf said.
But Vemulapalli said a structural engineer already has found the building to be safe.
"We want to open the building," he said. "They're playing games. They don't want me to open the building."
A remaining violation over problems with the building's exterior keeps Vemulapalli from leasing office space. Currently, the building's only occupants are Vemulapalli and an assistant who have to supply their own heat.
Vemulapalli said he hopes to fix the exterior later this year. A court date on the violation is set for next month, he said. The other violations have been dismissed, court records show.
The exterior worries 7th Ward Councilman Matt Schlinker, who represents the area. He said he's seen chunks of concrete from the facade on the sidewalk.
"What I see when I stand down there looking at this building scares me," Schlinker said. "The city administration cannot ignore a potential public health hazard like that."
But Second Ward Councilman Ed Taylor accused Kurtz and downtown business interests, including the Mott Foundation, of trying to run Vemulapalli out of town. He wondered why the city wasn't going after other apparent problem buildings in the downtown area, such as the Durant Hotel and Clark School.
"It's a waste of money by the city," Taylor said. "They are targeting and redlining Kumar. Anything that they can do to take this building from this man, that's what they're going to do. "
A spokeswoman with the Mott Foundation, which owns and is headquartered in the building next door, did not return a phone call Wednesday seeking comment.
Kurtz, who approved hiring Carl Walker Inc., the structural engineering firm, said the city is performing its duty to get the building fixed or razed. An appraisal hasn't been done yet.
"I certainly don't think that great big building in downtown Flint sitting empty is contributing to the development of downtown," Kurtz said.
The Vemulapallis filed their lawsuit suit early last year, one of two now pending in county circuit court before Judge Geoffrey L. Neithercut. A hearing over whether to dismiss the case is scheduled in March and a possible trial in May.
The second lawsuit is over the city's refusal to grant a state Renaissance Zone designation that would exempt state and local taxes. The couple received the designation before, but the city claims they are ineligible, saying they own property in Flint with back taxes.
The Vemulapallis counter they gave the properties away years ago to local nonprofits. Without the designation, the couple owes more than $183,000 in taxes in 2003. A similar amount is owed from 2002.
The property is worth $7.2 million, according to the city's records. The couple purchased it at an auction in 1997 for $500,000. Vemulapalli said he's since put $3 million to $4 million in repairs.
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Christofer Machniak covers Flint city government. He can be reached at (810) 766-6304 or cmachniak@flintjournal.com.
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Tue Sep 28, 2010 7:56 pm |
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Dave Starr
F L I N T O I D
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| I'm sure nobody would object to being assessed $1.00 per year until this is paid off. |
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I used to care, but I take a pill for that now.
Pushing buttons sure can be fun.
When a lion wants to go somewhere, he doesn’t worry about how many hyenas are in the way.
Paddle faster, I hear banjos. |
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Wed Sep 29, 2010 7:52 am |
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Cornbread Maxwell
F L I N T O I D
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Is there anyone who can sum up a timeline for this disaster? I have followed the story a bit and still cant quite figure out exactly why the city would be on the hook for this.
Prior to 1997, who owned it? When Vemulapalli bought it for $500k, were there any agreements with the city at that time? How and when did the city get mixed up in this buildings welfare?
Please help me to understand how this happened. |
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Wed Sep 29, 2010 8:05 am |
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