Wednesday, May 7, 2014

Recall petition started in Hailey

City offers to drop Old Cutters appeal

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By TONY EVANS
Express Staff Writer

    Hailey resident and development-impact-fee critic Bob Wiederrick launched an effort Monday to recall Mayor Fritz Haemmerle and veteran council members Carol Brown and Martha Burke from office because they have pursued an appeal of the Old Cutters court decision.
    Old Cutters has prevailed twice in federal court rulings that prohibit the city from collecting $2.5 million in annexation fees, and eliminate the company’s requirement to build 20 deed-restricted, affordable-housing units.
    Wiederrick’s recall petition would have to gather 748 signatures (20 percent of registered Hailey voters in the last city election) for a special election to proceed. In order to recall the leaders, more votes would have to be cast against individual officials during a recall election than the number of votes originally cast to put them in office.
    Wiederrick, who started an unsuccessful effort to repeal development-impact fees in 2008, said he started the petition because he opposes the continued use of taxpayer funds for appeals that he said the city could not win.
    “Of course it’s not in the attorneys’ best interest to stop the litigation,” he said. “They make money whether the city wins or loses.”
    Wiederrick said Tuesday that he has gathered three signatures so far.
    “I’m sure it will roll along as people know where to go and who to contact,” he said. “If it comes down to it, we may have to go door to door, but I hope there’s enough interest that people will seek me out.”
    City Administrator Heather Dawson said the city has spent $175,792 in legal fees defending against Old Cutters. An additional $35,000 was spent during initial bankruptcy court proceedings in 2011 that the city could not avoid, she said.
    Dawson said the city has not exceeded its budgeted legal fees at any time during the last three years due to the Old Cutters cases, but has delayed hiring in the street and snow-removal departments, a move made feasible by low snowfall.
    Dawson said no city services have suffered as a result of the legal expenses.
    “We feel that we have increased services over the past three years, especially in our city parks,” she said.
    Haemmerle has offered to drop the appeal if Old Cutters developer John Campbell agrees to close the door on future litigation over impact fees associated with the subdivision.
    Haemmerle said the city is willing to accept the court’s decision, and pay $100,000 in legal fees incurred by Campbell, but decided to appeal the ruling again when Campbell refused to sign off on about $800,000 in development-impact fees, and sewer and water hook-up fees that he would have to pay as he develops the remaining lots in Old Cutters subdivision.
    In an interview, Haemmerle referred to a clause in the 2006 annexation agreement that Old Cutters “shall not be entitled to any credit for any obligation for an impact or capital facilities fee, hookup fee, building permit fee, development-impact fee created in accordance with Idaho Code … or similar fee associated with the development of the property, by virtue of the payment of annexation fees.”
    “The city has a responsibility to defend its agreements,” he said.
    The 2006 agreement required the developer to pay $3.79 million in annexation fees, but the two federal courts deemed that amount “unquestionably in excess of” the city’s costs resulting from the annexation.
    Campbell maintains that the $1.3 million he has already paid in annexation fees covers the cost of development impacts associated with the 108-unit development.
    “It’s illegal for the city to charge twice for the same thing,” he said. “It’s not true that I want to sue the city over development-impact fees. I would rather sit down at the table and work out a fair resolution.”
    There should be ample time for negotiations. Hailey City Attorney Ned Williamson said the second appeal process could take up to two years to complete.
Tony Evans: tevans@mtexpress.com

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