City sues over Wall Street blight, zoning violations
NORWALK — Despite reports in the fall that Municipal Holdings LLC, an affiliate of Citibank, had begun addressing blight and zoning violations at a stalled Wall Street Place redevelopment, the city is pursuing legal action against the developer for negligence.
In a Dec. 28 filing in state Superior Court by the city of Norwalk against Municipal Holdings, citing the latter’s failure to respond to alleged violations, the city asks for an injunction to stop the continued violation of blight and building regulations and asks to set a 30-day deadline to remedy all violations.
The suit asks that Municipal Holdings pay damages and legal costs for the city for the “willful violation of the Blight Prevention Ordinance and Building Zone Regulations.”
In November, it appeared that there might be hope for the project on the horizon without the need for formal litigation.
Redevelopment Agency Executive Director Timothy Sheehan reported on Nov. 21 that a mediation hearing between Citibank and the city had been set for Dec. 13 in Stamford. On Nov. 27, William D. Ireland, Norwalk’s blight prevention officer, met with a representative from Viking Construction Inc., the contractors working on behalf of Municipal Holdings to address the citations.
At some point, though, communication apparently broke down. Neither representatives from City Hall, nor from Citibank, responded to requests for comment.
The lawsuit states that the day before the scheduled mediation, the city stuck Municipal Holdings with a $5,500 fine for repeated
failure to address multiple blight violations dating back to the summer.
The first notice came from Ireland Sept. 18, 2018, and described “health and safety issues, including but not limited to, incomplete firewalls, water entering the building, and inadequate joist and truss hangers.” It also described missing windows, rotted floors and accumulating trash. A citation followed on Sept. 19, notifying Municipal Holdings that it would be assessed a $100 fine per day if the blight violations remain unresolved. On Nov. 21, a “Failure to Pay Fine” notice was issued, but the violations were still not remedied and no appeal was made to the citation hearing officer, ultimately leading to the hefty Dec. 12 charge.
In addition to the onetime $5,500 fine, the suit states that the amount due will continue to increase at a rate of $100 a day. As of Monday, 33 days had passed since the ruling. According to Norwalk’s Blight Prevention Ordinance, failure to pay blight citations can result in the city placing a lien on the property.
Just as Municipal Holdings was being cited for repeated blight violations, Deputy Zoning Inspector John Hayducky was documenting zoning violations.
On Nov. 20, Hayducky cited Municipal Holdings for illegal use of land, failure to construct required public improvements and failure to abide by construction time restrictions. A second citation was filed by Hayducky, citing the same violations, on Dec. 5. Neither garnered a response from the would-be developers. On Dec. 18, Norwalk’s zoning citation hearing officer upheld the violations and allowed that Municipal Holdings should pay a daily $150 fine, retroactive to Dec. 10, until the violations are remediated.
In total, Municipal Holdings could be on the hook for close to $15,000, as of the time of writing. John D. Heppolette, a managing director at Citi Community Capital whose name is listed in the lawsuit, did not respond to a request for comment. It’s unclear at what point communications broke down, but a hearing for the case is scheduled for Feb. 4 at 9:30 a.m. at state Superior Court in Stamford.