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Tuesday

September 2014

2

City of Oconomowoc seeks to seize land for parking

Mayor: It wasn't an easy decision

City of Oconomowoc - After two years of failed negotiations with the owners of 219 W. Wisconsin Ave., the Common Council in a 4-3 vote Tuesday approved proceeding with eminent domain of the parcel. Officials said that condemnation is the only option to secure the land for public parking for the new community center.

"I don't know why it's come to this, but for the benefit of the community, we need to take action," said Community Development Authority Chairwoman Floss Whalen before the CDA voted unanimously torecommend a resolution to pursue eminent domain.

Directly after the CDA meeting, the Common Council met, and Director of Economic Development Bob Duffy outlined a timeline of negotiations between the city and Ken Herro and John Haas, owners of the parcel. Neither Herro nor Haas had a representative at the meeting. Herro did not return a reporter's call for comment by press time.

The two parties have gone back and forth about the property's value since the summer of 2010 (see related story). The city's latest offer is $250,000 based on its most recent assessed valuation. The property owners' latest value was $515,000 based on the their assumption they would rezone the property from its current residential zoning to mixed-use commercial.

Legal right?

Responding to Alderman Rich Allen's concerns about whether the city might be infringing on individual property rights by using eminent domain, Lieshout said, "There's no issue about it. This is going to be used for a public purpose, a public necessity."

Daley added that it's important to realize this plan for parking has been part of the community center plan all along. "It has been budgeted for, and if we don't proceed, we have no leverage, and we should abandon it and find another site. I think this is clearly the best site for this purpose." Daley noted that the land sits directly across from the community center, and added that the creation of the lot would make it contiguous with existing parking for the library.

"We have not tread lightly over the last two years ofnegotiations with offers that have exceeded fair market value. It's important to note it has never been an issue of acquisition or of the owner saying they don't want to leave. It's only been an issue of valuation.

"The city has at various times offered $350,000, and the owner has agreed to the price and backed away. There can be no accusation that the city did not negotiate in good faith with the property owner. It has been hard for me because I have great respect for one of the property owners, but I have to look at the rights of the taxpayers. … We're here to represent, protect and advance the city. We can either halt progress in downtown, or we can be held hostage and overpay. I find neither option appealing," said Daley.

Resolution possible

Lieshout said a slim percentage of cases that head to condemnation actually make it to a jury trial. He said there is the option at any time for Haas and Herro to agree to arbitration, or to settle the issue before a trial. He said in condemnation cases a judge always requires court mediation before allowing a jury trial, and issues are usually settled there. "We've had a condemnation case settled as the jury was walking in. It wasn't fun, but it was settled," Lieshout said.

If it does go to a jury trial, Lieshout added that, by law, the winner of a condemnation case is required to pay the legal fees of the loser, which are usually around $100,000 each party.

An official further explained that under condemnation law, if the jury award is 15 percent more than the offering price, the winning party must pay the loser's legal fees. They said for example, with the city's offer of $250,000 and Herro and Haas value the land at $600,000 and a judge rules the value is $300,000 that amount is more than 15 percent over the city's offer. Therefore, the city will have to pay its legal fees, their legal fees and still pay for the property which could equate to around $500,000.

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