A lawsuit filed against the city of Hailey for an alleged violation of Idaho's open meeting law remains open this week. Fifth Judicial District Magistrate Judge Ted Israel on Tuesday heard arguments for and against a motion to dismiss the suit, which he has taken under advisement.
The citizen lawsuit pertains to a $4 million deal approved in early February by the Hailey City Council to provide sewer services beyond city limits to the Peregrine Ranch property. Owned by developer Harry Rinker, Peregrine Ranch is located in Blaine County north of Hailey. Fifteen names are attached to the lawsuit, including those of county and Hailey residents.
In the face of the motion for dismissal, the plaintiffs' attorney, Fritz Haemmerle, needed to argue that as a result of the deal his clients would experience damages, such as an increase in sewer service costs. City Attorney Ned Williamson filed the motion for dismissal last month, arguing that the plaintiffs cannot prove damages.
The sewer services deal, signed Feb. 7 after an executive session, involved land acquisition as part of a settlement of a prior litigation matter, both items that can be legally discussed in executive session, according to Idaho code. Also part of the negotiations and the final deal, however, is the plaintiffs' point of contention that an agreement between Rinker and the city to extend sewer services outside the city was not noticed for public discussion and therefore constituted a violation of the public meeting law.
Haemmerle argued that if the Rinker deal with the city is implemented it will cause citizens to incur costs. Williamson argued that the plaintiffs cannot prove injury and whether Rinker acts on his option to connect to city services is not a forgone conclusion.
Haemmerle, on the other hand, argued that Rinker has no reason not to follow through. A city connection will enable his development plans and he has already made considerable investment in the city. As part of the city negotiation, Rinker paid a $1.35 million settlement and took title to 81 acres in south Woodside formerly owned by Judy Castle to settle a five-year-old lawsuit Castle filed against the city. Castle was seeking a $2 million claim against the city, which twice denied her development plans for the property adjacent to the Woodside Treatment Plant, off of Glenbrook Drive.
According to the agreement, at such time Rinker gains county approval of any development plans he has for the 160-acre Peregrine Ranch, he can hook into the city sewage treatment plant. The city would at that time take title to the former Castle property.
Haemmerle argued that the sewer services agreement is the best-case scenario for Rinker to achieve his proposed 380-unit residential development plans for the property, which would require a sewer plan.
Williamson has said that because the sewer services agreement was intertwined with the related business negotiations of the city, wrapping the issue into the executive session seemed appropriate and saved the city money. He added that the City Council had hoped that more of the proceedings could have been handled with public scrutiny, but that they deferred to his judgment that it would have compromised the city's bargaining power in terms of the Castle lawsuit.
At the hearing on Monday, Israel did not say when he would make his ruling.