$1.8M lawsuit payout splits city

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When the city of Powell agreed last month to pay developer Charlie Vince $1.8 million to settle his lawsuit, some in the community were shocked. They wanted to know how the figure was calculated and whether officials did enough to defend taxpayers’ money.

The settlement arose from a charter amendment initiated by a citizens petition and approved by voters in late 2014, according to a Powell news release.

The developer had proposed building 14,000 square feet of retail and

office space along with 64 apartments along Olentangy Street near Powell City Hall.

The City Council approved the Center at Powell Crossing plan in 2014. However, a group of residents who were opposed to high-density housing there challenged the decision with a charteramendment initiative that 56 percent of voters backed. The city then withdrew its approval of the plan, sparking the lawsuit.

U.S. District Court in Columbus found that the amendment was an unlawful delegation of legislative power and invalidated it. The court ruled that Powell Crossing was entitled to damages and attorney fees related to construction delays.

Some residents said the city should have fought the judge’s decision. But not long after Vince’s legal victory, attorneys and appraisers began to calculate how much Vince was owed.

In a confidential letter obtained by The Dispatch through a public-records request, Vince’s attorney, Joseph Miller, told attorneys for the city that Vince faced “increased construction costs, lost rents, lost land value and the lost

return on the fair-market value of its Powell Crossing development.”

The tab, once $500,000 in legal fees were added, was $3.6 million, according to the Jan. 18 letter, exactly twice what the city eventually agreed to. Powell’s insurance carrier paid about half of the final amount.

To some people, a 50 percent reduction after lengthy negotiation might be considered a bargain. But to David Ebersole, who has criticized Powell’s leaders, accusing them of not standing up for the city’s interests, it has become a campaign issue.

Ebersole is seeking one of four open city council seats. At a recent meeting, he accused council members of misspending public money. He had to be escorted by police from the council chamber after speaking beyond the three-minute limit.

Ebersole’s campaign literature also asks the city to detail how the settlement was reached.

“If council did not know the basis and details of the settlement amount when they voted, they should not have voted for and agreed to the settlement. If they do know, then they should have disclosed and explained it prior to the vote.”

Mayor Brian Lorenz disagrees with almost everything

Ebersole has said. The negotiations were confidential, Lorenz said. And he believes a small minority of residents pushed the ballot issue on an ill-informed public.

“We had done our best to warn the petitioners that this would be the likely outcome,” Lorenz said. Then, “during the course of the negotiations, we worked really diligently to come up with a settlement amount that both parties could live with.”

Vince, 74, of Columbus, is just glad the project is back on track.

“The city knew I was zoned properly. They had to cooperate with me,” he said. “I think the city of Powell and its citizens were both victims in this.”

“I knew upfront that this was an unconstitutional thing. ... We lost a lot of money in the constructioncost increases alone.”

At last week’s council meeting, Councilman Daniel Swartwout accused Ebersole, a lawyer, and his followers of pretending to know more than the city and its team of attorneys whose job was to minimize the lawsuit damage.

“The council made it our mission to protect your tax dollars,” Swartwout said. “It was incumbent upon us to stop the bleeding.”

Councilman Brendan Newcomb, who said he supports

Ebersole for his “integrity and passion,” also voted to approve the settlement. But Newcomb didn’t think the $1.8 million amount should have been kept secret until just before it was put to a vote.

“It wasn’t a surprise for us, but it was for a lot of people,” Newcomb said. “It’s their money. What are we doing with it?”

Councilman Jon Bennehoof, who has criticized backers of the ballot initiative, said, “We’ve virtually lost our entire ‘rainy-day fund,’ which took over a decade to build, because of these failed lawsuits, specious arguments and misplaced direction.”

Vince said it might take time to attract commercial tenants. “We’ve been in court so long, nobody’s been interested in talking to me,” he said.

“I think once the project is finished, people will wonder what they were fighting about. It’s going to be real nice.”

Although it’s been a “trying time” for the city, Mayor Lorenz thinks residents might be better informed about future growth.

“I’m not happy about shelling out any money. But we’ve made that crossroads, and we’re ready to move forward.”