City, Laidlaw reach agreement in lawsuit
by Terra Temple
Aug 31, 2011 | 3483 views | 0 0 comments | 68 68 recommendations | email to a friend | print
Following a closed session during its regular Aug. 22 meeting, the Metropolis City Council came back into open session to adopt a resolution approving a settlement with Laidlaw.

The issue goes back to 2001 when Laidlaw had plans to build a new coat hanger manufacturing plant in Metropolis. At the same time, the company was forming a new firm with Shanghai Wells Hanger Co. in China. To keep the plant in Metropolis, the city and Laidlaw entered a private development agreement and a loan agreement for constructing a facility in Metropolis Industrial Park.

According to city attorney Rick Abell, when Laidlaw built the new facility, "the city agreed to loan Laidlaw $2 million and Laidlaw was also supposed to get a ($250,000) grant from the State of Illinois" that would be funneled through the city and the city would provide the grant to Laidlaw.

"As it turned out, the city never got the grant," Abell said.

The lawsuit pends from a 2007 dispute between the City of Metropolis and Laidlaw in which both sides filed claims. The city filed a foreclosure action to enforce the mortgage while Laidlaw filed a declaratory judgment, asking a court to review and declare the mortgage had been paid in full and satisfied and order the city to release it.

"The city took the position that the $2 million it gave to Laidlaw was on loan and Laidlaw took the position that $1,750,000 should've been loaned and they should've gotten a ($250,000) grant under any and all circumstances," Abell explained.

The suit started in circuit court in Peoria. The City of Metropolis filed a motion to have it removed to Massac County. That motion was granted and the suit has been pending in Massac County ever since.

In the settlement:

• Laidlaw agreed it owes the city $250,000.

"That amount will be secured by the mortgage the city has against the property," Abell said. "Since the loan started, there's been a mortgage there and it's never been released because the city claims there's still $250,000 owed. That $250,000 is still owed to the city and the parties agree to that."

• The city will not charge interest on the $250,000 until July 31, 2012.

"That would give (Laidlaw) another year, if need be, to sell the property and pay off the principal amount," Abell said. "They would not have to make any payments in the meantime, unless they lease the property. We've got a formula in there for how much they would pay and under what circumstances. If (the property's) just vacant, they wouldn't make any payments on that."

• Laidlaw will continue to pay the taxes, keep the property insured and pay the utilities. "And if certain things happen, the city could always come back and foreclose its mortgage," Abell said.

• The city and Laidlaw agreed to dismiss the lawsuit.

"The goal, of course, is (Laidlaw will) be able to sell the property, the city will get paid off and we'll have a new business out there that creates jobs," Abell said of the settlement. "That'll benefit everybody and that's what the goal was — not to penalize anyone on either side — to try to make it as easy as possible to help them sell the property so maybe we can get a new business out there."

During its regular session on Aug. 22, the council followed the recommendation of the Planning Commission to deny a special use permit for 721 Metropolis St.

The property's new owners, Linda Grace and Lucas Grace, planned to place a private community center in the ground floor of the residence to host parties, reunions, receptions, showers and similar events.

In its recommendation report, the commission cited the site's being in a residential and older neighborhood, insufficient parking, traffic noise, litter and other things that might affect the character of the neighborhood.

A special use permit is not a rezoning of the property. If granted, it allows the current property owner to use the property in a manner that's somewhat different from what the zoning classification would allow. The permit is non-transferable and can be limited to other restrictions, such as time.

Alderman Jerry Mizell said he applauded Grace for wanting to open such a business but stated he wished she'd gone to the Planning Commission before purchasing the property.

Abell noted the public should make inquiries regarding the city's zoning prior to making property purchases.

Chad Murray, the city's Zoning & Building administrator, noted that many residents have "the grandfathered thought process," stating that people buy property based on what used to be there thinking they can do the same business. He said for places like 721 Metropolis St., which used to be a hospital, or opening a garage at the former B&S Bus Service location, "that doesn't apply now but there are plenty of other places in town to do those things."

In other business on Aug. 22, the council:

• Adopted a motion for closing Vienna Street from Seventh to Eighth streets from 9 a.m. until 5 p.m. on Monday, Sept. 5 for Labor Day activities sponsored by the First Missionary Baptist Church.

• Adopted a resolution for street closures for the annual Massac County High School homecoming parade on Friday, Sept. 30. The closure of Market Street to West 10th Street to Ferry Street ending at Washington Park will be from 3:30-5:30 p.m.

• Adopted a motion to close Ferry Street from the north side of Second Street to the south side of Fourth Street and Third Street from Metropolis to Market streets from 7 a.m. Thursday, Oct. 6 until 9 a.m. Tuesday, Oct. 11 for the 11th annual Super City Blues and Ques.

• Adopted a motion to close Park Street, along Washington Park, from 7 a.m. until 9 p.m. on Saturday, Oct. 8 for a craft/flea market sponsored by the Metropolis Kiwanis Club.

• Approved pay estimate number six in the amount of $125,674.38 from Woodwalkers Electric LLC for phase one of the the 12kV system conversion project.

• Approved the hiring of four paid on-call firefighters.

• Adopted a motion to make repairs to the Waste Water Treatment Plant's flow meter in the amount of $4842.80 by HACH.

• Approved Keith Stokes, lineman with the electric department, and Murray to attend PCB training Oct. 25-27 for the approximate cost of $2500. Alderman Richard Corzine voted against the motion.

• Approved the purchase of underground primary wire from Fletcher Reinhart in the amount of $5615.

• Approved the $24,275 grant request for the 38th annual Fort Massac Encampment.

• Approved the 2011-12 marketing budget for Metropolis Tourism in the amount of $118,000. In a separate motion, the council approved the first installment of that budget in the amount of $16,300.

• And, had a first reading for a property annexation ordinance for Gordon McIntosh on West Fifth Street. Abell explained the "small piece of property never got annexed to the city. If we proceed with plans to TIF Fifth Street, we'll need to annex this and several others."

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