Delaware lending company challenge eminent domain price tag
The former owners of the Wonderland property, which was taken by the city through eminent domain as the site for the new high school, are not happy with the $29.5 million Revere intends to pay for the property.
CBW Lending LLC, a Wilmington, DE based Limited Liability Company, has filed a complaint in Suffolk Superior Court which kicks off a lawsuit against the city. According to Attorney Peter Flynn, who along with Attorney Jason Scopa is representing CBW Lending, the money the city offered for the property is inadequate and does not reflect the fair market value of the site.
“My clients recognize that in eminent domain cases, landowners can challenge if it’s an improper taking,” said Flynn who has a long history of successfully representing landowners in eminent domain takings. “They are not challenging the process; they are only challenging the amount of compensation. As Flynn sees it, the city’s offer is between $40 and $100 million short.
“My clients who are roaringly successful people from New York, have hired the best lawyers and the best experts,” said Flynn. “The battle will be over how much that property is really worth.
For city officials who are struggling to find ways to pay for the new high school without crushing taxpayers, the idea of adding an additional $40 million to the cost of the project is daunting. But the lawsuit looking for more money was not unexpected.
“The (complaint) was not a surprise,” said City Council President Patrick Keefe. “Ultimately, I think everyone expected that there would be some litigation. We did prepare to have an attorney.” But Keefe seemed confident that the city’s appraisal of the property could withstand a challenge from CBW Lending.
“Those are make-believe numbers. There is zero evidence that piece of property is worth that. If it were such a valuable property, why would it lie vacant for so long?” he asked.
“Surely they’ll try to find some sort of analysis that leads to a minimum price of $70 million,” said Keefe who added he has faith in the court system to look at the numbers and come up with something fair.
Councillor-At-Large Dan Rizzo also said CBW’s lawsuit was no surprise.
“There was no way we were going to get that property for $29 million,” said Rizzo who pointed to the $355 million Amazon paid for the Necco plant and the $50 million the online retailer spent on the Showcase Cinema property on Squire Road.
‘I don’t know how we can take a valuable piece of property off the tax rolls. It’s just bizarre to put a high school at the farthest most eastern part of the city,” said Rizzo who added the school should be centrally located and he would never support a high school at Wonderland under any circumstances.
Next Monday, the city council’s Ways and Means subcommittee will vote on whether to recommend that the full council approve the building design and its $470,000 budget.
Rizzo said people keep talking about education but added committee member aren’t voting on education, they’re voting on a construction project with a serious budget. For Rizzo, financing is key.
“When you’re exposing residents to this lawsuit, an unknown that will be decided in court, the numbers have to make sense,” he said.
Rizzo suggested giving the property back to the original owners and starting work on the possibility of building the school on its current site.
School Building project leaders have repeatedly said that would delay the project by a year, during which construction costs will jump possibly nine percent. But Rizzo sees potential benefits in the delay.
“We’re in a unique time,” he said. “It’s the highest inflationary time, interest rates are at an all -time high…” he said. A delay might give the overall economy time to relax and readjust.
Like Keefe, Ward 5 Councillor John Powers, a member of the Ways and Means Committee, questions the value of the Wonderland site given its history as a vacant, blighted nuisance for the city.
“It’s a very wet area,” said Powers. “I believe the property was not a positive area for a developer. If it was a buildable property, developers would have already come in.”
Powers said $100 million was a grossly inflated price.
“I don’t know the answer,” he said, “but we need a new high school.”